The bid faded as retail sold, inclusive of corporate bond sales of 2-years, 3-years, and 5-years, and a large $1b billion corporate bid list. Interestingly, the news sparked a modest price pullback and a narrow range followed.
Ahead of the 10-year auction prices popped -- short covering on speculation of a strong auction, and hedge fund sales of mortgages ($1.8 billion), vs. buying Treasuries. But poor auction results took prices lower again. However, the "dovish" FOMC minutes caught shorts off guard, and with fresh buying and technicals forced in, Treasuries soared for the balance of the session.