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Treasury 30-Year Bond Auction Draws Record Low Yield of 2.17%

Dramatically wider U.S. federal budget deficits, which stoked concerns about lower Treasury prices and higher yields as the supply of debt increased, are having the opposite effect, Williams said.

Resolution - Treasury 30-Year Bond Auction Draws Record Low Yield of 2.17%

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Comments of the Day

11 October 2019

 

 

Video commentary for October 10th 2019

 

Eoin Treacy's view

A link to today's video commentary is posted in the Subscriber's Area. 

Some of the topics covered include: Optimism on the trade war and Brexit lift risk assets and see a decline for safe havens, Pound strong, gold weak, oil steady, Japan breaking upwards, 

 

 

Market Internals

 

Eoin Treacy's view

I have to admit I don’t look at the internals of the market all that often because it is the trend rather than the day to day moves which lend some insight into the health of the market. I thought it might be useful to look at some of the most common measures to discern if any clues to market direction are evident.

The Total Number of New 52 Week Highs on the NYSE Index is coming back down towards the lows December 2018 and towards the end of 2015. The significant spike on the upside in late 2017 was an anomaly suggesting a period of underperformance ahead, but generally lows are better predictors of market bottoms than spikes are of tops.

 

 

Treasury 30-Year Bond Auction Draws Record Low Yield of 2.17%

This article by Elizabeth Stanton for Bloomberg may be of interest to subscribers. Here is a section:

Dramatically wider U.S. federal budget deficits, which stoked concerns about lower Treasury prices and higher yields as the supply of debt increased, are having the opposite effect, Williams said.

“You increase debt, and you’d think you’d increase yields in a dramatic way, but you’ve pulled forward growth from the future,” Williams said.

The longest-maturity Treasuries also have benefited from the government’s reliance mainly on shorter-maturity sectors to finance bigger deficits. Net issuance totaled $1.045 trillion in fiscal 2019, an increase of 31% from 2016. But while net bond sales increased by 33%, issuance of notes maturing in two- to 10-years doubled to $696 billion.
 

 

Eoin Treacy's view

The deflationary consensus is pervasive and ensured the Treasury did not suffer another failed bond auction this afternoon. Nevertheless, just because $1 trillion deficits are not awakening investors to the risks of wholesale currency devaluation that does not mean the situation will persist indefinitely.

 

 

Johnson and Varadkar See 'Pathway' to a Possible Brexit Deal

This article by Tim Ross and Robert Hutton for Bloomberg may be of interest to subscribers. Here is a section:

Afterward they issued a joint statement saying they had identified the potential for a route to an agreement during the course of a “detailed and constructive discussion.”

Both leaders “continue to believe that a deal is in everybody’s interest,” they said in the statement. “They agreed that they could see a pathway to a possible deal.”

 

Eoin Treacy's view

Boris Johnson has every incentive to make a deal since he gets to blame Theresa May for any of the unsavoury bits which are lumped in get it over the line. Meanwhile, he has to hold fast to his exit deadline to lend urgency to the negotiations. Every time optimism about a successful resolution improves the Pound rallies.

 

 

Eoin's personal portfolio: precious metals long initiated

 

Eoin Treacy's view

One of the most commonly asked questions by subscribers is how to find details of my open traders. In an effort to make it easier I will simply repost the latest summary daily until there is a change. I'll change the title to the date of publication of new details so you will know when the information was provided.

 

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