In its refunding announcement on April 30, 2008 the Treasury announced that it will begin issuing 52-week bills every four weeks. Treasury notes are sold at regularly scheduled public auctions. Competitive bids at these auctions determine the interest rate paid on each Treasury note issue. Twenty primary dealers (as of November 30, 2007) are authorized and obligated to submit competitive tenders at Treasury auctions. Dealers can hold, resell, or trade the securities with other firms. The Treasury usually announces the size, date and time of the monthly two-year note auction on the third or fourth Monday of each month. The auction takes place the following Wednesday and the securities are issued (settled) on the last day of the month. If the last day is a weekend or a holiday, the securities are issued on the first business day of the following month. Why Investors Care
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Highlights
Demand for this week's bill auctions was a bit less strong than prior weeks, likely reflecting very large auction sizes and also pending supply ahead of Wednesday's 2-year and Thursday's 5-year note auctions. The bid-to-cover ratio for today's $29 billion 4-week auction slipped to 2.78, still very solid, with the bid-to-cover ratio for the $20 billion 52-week auction at a respectable 2.34.
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