• 367 days Will The ECB Continue To Hike Rates?
  • 367 days Forbes: Aramco Remains Largest Company In The Middle East
  • 369 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 769 days Could Crypto Overtake Traditional Investment?
  • 774 days Americans Still Quitting Jobs At Record Pace
  • 775 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 779 days Is The Dollar Too Strong?
  • 779 days Big Tech Disappoints Investors on Earnings Calls
  • 780 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 781 days China Is Quietly Trying To Distance Itself From Russia
  • 782 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 786 days Crypto Investors Won Big In 2021
  • 786 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 787 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 789 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 789 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 793 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 794 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 794 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 796 days Are NFTs About To Take Over Gaming?
How The Ultra-Wealthy Are Using Art To Dodge Taxes

How The Ultra-Wealthy Are Using Art To Dodge Taxes

More freeports open around the…

What's Behind The Global EV Sales Slowdown?

What's Behind The Global EV Sales Slowdown?

An economic slowdown in many…

Another Retail Giant Bites The Dust

Another Retail Giant Bites The Dust

Forever 21 filed for Chapter…

  1. Home
  2. Markets
  3. Other

Meager Foreign Participation in Treasury Auctions

Today's auction of $21 bln in 3-year treasury notes drew 24% participation from foreign investors (indirect bidders), which was above February's 22% but lower than the 2003 and 2004 averages of 27% and 45%.

Last month's 2-year auction drew 24% participation -- the lowest since November 2004, while the 5-year auction drew 21% participation -- the lowest since the records began in February 2003.

  • Although the high yield element of the US treasuries does remain a point of attraction for foreign investors, it is not reflected in the primary market auctions, leading us to believe that private investors (foreign central banks and offshore hedge) are mostly snapping them in the secondary market.

  • But the increasingly meager foreign participation in US treasury auctions could reflect a general backtracking in foreign demand for US paper in light of the combination of a looming end to the Fed rate hikes and the emergence of the dollar's external imbalances, which is not expected to acquiesce any time soon with oil prices on the rise.

  • The concern on US fixed income paper becomes highlighted when discouraged foreign participation in treasury auctions begins to: 1) raise the cost of government borrowing and; 2) further impacts the housing market as it drives up long term yields along with rising inflationary expectations.

 

Back to homepage

Leave a comment

Leave a comment