Treasury Action: yields probed 2-week highs Treasury Action: yields probed 2-week highs at the long-end as the stock market exuberance continued to roll back yields to pre-plunge levels. The tiny TIPS auction had little bearing and reflected mixed signals on inflation risks as the Fed takes another step closer to the exit next week. The T-note yield is testing the 2.30% area, having shot 10 basis points higher from 2.20% in Asia and is nosing toward the 2.30-2.35% zone, having based at global margin call lows of 1.86% on October 15. Plenty of talk of a short-squeeze on hedge funds on Wall Street is doing the rounds as well.
Treasury announced a $93 B 3-pronged package of auctions for next week Treasury announced a $93 B 3-pronged package of auctions for next week, in line with the size over recent months. This includes a $29 B 2-year note (Tuesday), a $35 B 5-year (Wednesday), and a $29 B 7-year (Thursday). Debt managers also outlined a $15 B 2-year FRN (Wednesday), and a $54 B 3- and 6-month bill offering (Monday). Supply could be a factor keeping upward pressure on yields next week.