With bond long-ends blowing up across the globe, driven by among other things, justified fears of a looming surge in supply, moments ago the US Treasury sold $58 billion in 3Y notes. And while the auction consisted of relatively low duration paper, one could feel modest cracks in demand all the way near the front-end of the curve. Here's what happened: the auction prices at a high yield of 3.891%, this was about 9bps lower from the 3.972% last month, but it tailed the When Issued 3.887% by 0.4bps, the same tail as June and the 4th tail in the past 5 auctions. {chart} The bid to cover was also subpar at 2.51, down ... (full story)