Treasury’s Refundings End on a Soft Note as 30-Year Auction Tails — Evening Brief – 11.13.25 

The U.S. Treasury closed out its quarterly refunding cycle on Thursday with a $25 billion sale of 30-year bonds that broadly underwhelmed investors. The auction cleared at a high yield of 4.694%—below last month’s 4.734%—but it tailed the When-Issued yield of 4.684% by one basis point, marking the second consecutive tail and the largest since August, when the long bond tailed by 2.1 basis points. Demand metrics were similarly soft. The bid-to-cover ratio fell to 2.295 from 2.382, the weakest since August’s 2.266; excluding that outlier, it would have been the lowest since 2023. 

The internals painted a mixed picture. Indirect bidders, a proxy for foreign demand, stepped up meaningfully, taking 71.0% of the auction, up sharply from 64.5% and the highest allocation since October 2024. However, that strength was overshadowed by a steep drop in Direct bidders, who absorbed just 14.5% compared to 26.9% last month, their lowest participation in more than a year. As a result, primary dealers were left with 14.5%, the most since August. The market’s reaction was clear: yields pushed higher across the curve, reflecting broad disappointment with the auction. 

Thursday’s softness followed another lackluster result on Wednesday, when the Treasury sold $42 billion in 10-year notes. That auction priced at 4.074%, down from 4.117% in the prior month and the second-lowest yield since last October, but it also tailed the When-Issued level of 4.068% by 0.6 basis points—its second straight tail.  

The bid-to-cover ratio slipped to 2.433 from 2.478, marking the second-weakest showing since August 2024. Indirect bidders took down 67.0%, marginally above last month’s 66.8% but well below their 70.2% recent average, while Direct bidders absorbed 22.55%. Dealers, once again, were left holding more than usual at 10.5%, the most since August. 

Taken together, the back-to-back tails, soft bidding metrics and dealer-heavy allocations suggest persistent investor hesitancy at a time when supply remains elevated. While foreign buyers offered a bright spot in the long-bond auction, the broader tone across the week was unmistakably cautious.