June Mid-Month Auctions: Coupon and Yield Trends

5 Jun 2020

By Bobby Timberlake 

As Treasury issuance amounts set new records, coupons at the front end of the curve have marched downward, while back-end coupons have lagged.

Yield spreads across each popular measure show a consistent steepening of the curve through the first half of 2020.

While the Federal Open Market Committee (FOMC) has cut the Fed Funds target rate to nearly zero, focusing attention on Treasury notes at the front of the yield curve, equally interesting may be the relative movement at the back end. The mid-month auctions of the 3-year, 10-year, and 30-year provide an opportunity to examine Treasury trends a month after the May refunding that set a new trajectory on government borrowing.