Unlike yesterday's unexpectedly strong 3Y auction, which stopped through with impressive metrics despite the "hawkish" JOLTS report which showed a record number of job openings, moments ago the Treasury sold $23 billion in 10Y paper in a surprisingly poor refunding auction, which stopped with a large tail and with the smallest bid/cover since last November's Refunding. The buyside takedown figures were also light, particularly the Indirect takedown.

The high yield was 2.25%, tailing the 2.234% When Issued by 1.6bps, the fifth consecutive tail in a row, if lower than July's 2.321%. The bid to cover was 2.23, the lowest since November 2016, and far below the 6 month trailing average of 2.46.

The internals: Indirect bidders took down 57.9% of the auction, the lowest award to foreign buyers since December, and below 6MMA 64.6, while Direct bidders took down 6.8%, in line with the 6.9% 6 month average. Dealers were left holding 35.3% of the final allotment, the highest since last December.

In summary, yet another poor refunding auction, which was surprising in light of today's modest risk off tone on North Korean geopolitical concerns.