The U.S. Treasury auctioned off $25 billion of the 30 year bonds at a high yield of 5.046%
- WI level at the time of the auction 5.041%
- Tail 0.5 basis points
- Bid to cover 2.30X
- Directs 21.74%
- Indirects 66.6%
- Dealers 11.66%
AUCTION GRADE C
The third of three coupon auctions this week. The three year and a 10 year came in below average demand.:The indirect international demand was near the average. The director demand was also near the average. The bid to cover was lower than the six month average while the tail was higher than the six-month average.
I give the auction a grade of C as it was a touch better than the 10 year and feeling generous, but the grade was just off being a C- like the 10 year auction. Rick Santelli gave it a C- grade (same as the 10 year).
US yields are modestly higher today. The two year yield is just below the 4% level at 3.99%. The 10 year is below 4.50% at 4.476%, while the 30 year is higher on the day and moving away from 5.00%.
US stocks are not bothered with both the S&P and NASDAQ indices on pace for record closes today. The S&P index is up 48.5 points or 0.66% at 7449.74. The NASDAQ index is up 333 points or 1.28% at 26421
Interest rates are influential in the mortgage market. The average US 30-year fixed mortgage rate is currently 6.37% for the latest weekly reading from Freddie Mac.
Here is the comparison:
- Current : 6.37%
- Start of 2026 / near year-end 2025 (week ending Jan. 8, 2026): 6.16%
- One year ago: 6.76%
So compared to:
- The start of the year: rates are up about 21 basis points
- A year ago: rates are down about 39 basis points
