Quick check-in on today’s 30-year TIPS reopening

The US Treasury is reopening CUSIP 912810RF7 today, creating a 29-year 4-month Treasury Inflation-Protected Security with a coupon rate of of 1.375%. Non-competitive bids (such as through TreasuryDirect) need to be placed by noon, the auction closes for competitive bids at 1 p.m.

This TIPS – first issued in February – trades on the secondary market, so we can get a pretty good idea of today’s price. Here’s where we stand at 10:05 a.m.:

  • Bloomberg’s Current Yields page shows this TIPS trading right now with a yield of 0.94% and a price of about $111.10 per $100 of value. This is up about 5 basis points from when I wrote about this auction last week.
  • The Wall Street Journal’s Closing Prices chart shows this TIPS closed yesterday with a yield of 0.922% and a price of about $111.30.
  • The Treasury’s Real Yields estimate shows that a full-term 30-year TIPS closed yesterday at 0.94.
  • The TIP ETF is currently trading at $113.52, down about 0.25%, which indicates that yields are slightly rising.

So it looks like this TIPS might price with a yield of about 0.95% and somewhere around $111 per $100 of value, which results from the coupon rate of 1.375%.

This is down substantially from recent 30-year auctions, but much higher than the depths of yield we hit two years ago. I’ll post the auction results after 1 p.m. and provide more reaction later.

Meanwhile, you can study this … the results of every 29- to 30-year TIPS auction in history:

30 year TIPS

Advertisements
This entry was posted in Investing in TIPS. Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s