After a solid 2Y auction and a subpar 5Y auction earlier this week, moments ago we got the week's final Treasury issuance when the US auctioned off $44BN in 7Y paper in a perfectly average sale.

Starting at the top, the bond priced at a high yield  of 4.260%, down modestly from 4.290% last month and in the middle of a range established in late-2023 after which the 7Y has traded between 3.50% and 5%. The auction also priced on the screws with the When Issued which was also at 4.260. 

The bid to cover was 2.498, just under last month's 2.516 and on top of the 6-auction average of 2.488%.

The internals were a bit weaker: after Indirect bidders took down a record 78.4% in May, today their demand crashed to earth and foreign buyers ended up taking down just 57.55%, the lowest since Sept 26. And with Directs taking down 29.7%, a big jump from 11.2% in May but in line with the recent average, Dealers were left holding 12.75%, up from 10.42% a month ago and the highest since November.

Overall, this was a average-to-weak auction, with sufficiently good metrics even if the internals were a bit on the weak side. Not that the market cared (about this, or anything else); with 10Y yields extending their drop all day today, the meh auction barely registered.