The Treasury will auction 3s 10s and 30s this week. Here is some interesting commentary from Ian Lyngen at BMO Capital markets on auction dynamic. This is an excerpt from a longer note to clients:
We’ll also see the takedown of the 3s, 10s, 30s trio of Treasury auctions on an accelerated scheduled with the first installment on Monday afternoon. While the shift in timing and holiday closures might intuitively be concerns for auction participation, this week’s $56 bn in gross issuance will be more than offset by $76.8 bn in maturities, leaving a net paydown of $20.8 bn. For context, this will be the largest paydown on record for this trio and in fact, one needs to go back to May 2008 (prior to the introduction of the 3-year) for find a larger paydown. The influence on the auction process is less obvious from the net negative cash need, but we struggle to view this as anything outside of a bond-bullish underpinning.