United States USD

United States 20-Year Bond Auction

Impact:
Low

Latest Release:

Date:
Actual:
2.21%
Forecast:
Previous/Revision:
1.942%
Period:
What Does It Measure?
The United States 20-Year Bond Auction measures the demand for U.S. government securities with a maturity of 20 years, explicitly gauging investor interest in long-term borrowing by the federal government. It primarily focuses on the yield, the total amount sold, and the bid-to-cover ratio, which indicates the level of demand relative to supply, serving as a barometer for investor confidence and interest rates.
Frequency
The 20-Year Bond Auction occurs monthly, with results typically released on the last Wednesday of the month as a final figure, reflecting the outcomes of the auction held earlier.
Why Do Traders Care?
Traders pay close attention to the 20-Year Bond Auction due to its implications for interest rates and overall market sentiment, as it directly influences U.S. Treasury yields and can impact various financial assets. Strong demand, indicated by competitive bidding and lower yields, is generally seen as bullish for equities and the U.S. dollar, while weaker demand may exert bearish pressure on these assets.
What Is It Derived From?
The auction results are derived from the competitive and non-competitive bids made by institutional and retail investors, reflecting their willingness to purchase bonds at specified yields. The final yield is determined by the highest accepted bid, while the bid-to-cover ratio compares total bids to the amount offered, indicating demand strength.
Description
The 20-Year Bond Auction is a critical component of U.S. government financing and provides insight into long-term interest rate expectations. It is closely watched by economists and investors for trends related to inflation expectations, government borrowing needs, and investor risk appetite, making it a significant indicator of financial market health.
Additional Notes
This auction serves as a bellwether for long-term economic sentiment, often compared to other auctions for bonds of different maturities. It is considered a coincident indicator, reflecting current market conditions and demand for long-term debt, which is essential for assessing broader economic trends.
Bullish or Bearish for Currency and Stocks
Stronger-than-expected demand: Bullish for USD, Bullish for Stocks.

Legend

High Potential Impact
This event has a strong potential to move markets significantly. If the 'Actual' value differs enough from the forecast or if the 'Previous' value is significantly revised, it signals new information that markets may rapidly adjust to.

Medium Potential Impact
This event may cause moderate market movement, especially if the 'Actual' deviates from the forecast or there's a notable revision to the 'Previous' value.

Low Potential Impact
This event is unlikely to affect market pricing unless there's an unexpected surprise or a major revision to prior data.

Surprise - Currency May Strengthen
Actual deviated from Forecast on a medium or high impact event and historically could strengthen the currency.

Surprise - Currency May Weaken
Actual deviated from Forcast on a medium or high impact event and historically could weaken the currency.

Big Surprise - Currency More Likely To Strengthen
'Actual' deviated from 'Forecast' more than 75% of historical deviations on a medium or high impact event and may likely strengthen the currency.

Big Surprise - Currency More Likely To Weaken
'Actual' deviated from 'Forecast' more than 75% of historical deviations on a medium or high impact event and may likely weaken the currency

Green Number Better than forecast for the currency (or previous revise better)
Red Number Worse than forecast for the currency (or previous revise better)
Hawkish Supports higher interest rates to fight inflation, strengthening the currency but weighing on stocks.
Dovish Favors lower rates to boost growth, weakening the currency but lifting stocks.
Date Time Actual Forecast Previous Surprise
Jan 19, 2022
2.21%
1.942%
Dec 21, 2021
1.942%
2.065%
Nov 17, 2021
2.065%
2.1%