30-Year TIPS Auctions With Real Yield Of 0.501%, Lowest In Nearly 7 Years

Summary

  • Today’s reopening auction generated a real yield of 0.501%, a whopping 59 basis points lower than the originating auction on February 21, 2019.
  • Investors had to pay a huge premium for the 1.0% coupon rate, about $115.68 for about $101.79 of value, after accrued inflation is added in.
  • Nevertheless, this auction appears to have been met with strong demand from big-money investors.

The real yield was down a bit from where this TIPS was trading on the secondary market at noon, an hour before the auction close. At that time, the real yield was 0.52%. The lower yield at auction indicates this issue had solid demand from investors.

Read my full analysis on SeekingAlpha.com

detail

About Tipswatch

Author of Tipswatch.com blog, David Enna is a long-time journalist based in Charlotte, N.C. A past winner of two Society of American Business Editors and Writers awards, he has written on real estate and home finance, and was a founding editor of The Charlotte Observer's website.
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