Just an hour and a half after Bessant stated at a congressional hearing on the evening of the 15th that the US had recently completed "two of the most successful US Treasury auctions in twenty years," a $13 billion 20-year Treasury auction gave a contrary signal: the winning yield was 5.420%, 2 basis points higher than the pre-auction yield, the largest tail difference since December 2024; the yield also hit a record high since issuance of this maturity resumed in 2020. Indirect bidders were allocated only 52.5%, the lowest on record for modern 20-year Treasury bonds, while direct bidders' allocation rose to a record 30.7%, indicating that some domestic funds took over. The overall bid-to-cover ratio was 2.57, lower than the six-month average of 2.65, indicating significant weakness, but not yet reaching the point of no takers.
