The Treasury bought back $6 billion of nominal coupon securities in the 20 year to 30 year maturity bucket on Tuesday, the full maximum purchase amount it had set for the operation. Holders offered $10.746 billion, so the operation was covered 1.79 times, and Treasury accepted paper in 6 of the 35 eligible issues. The operation ran at 1:40 p.m. Eastern on October 27 under the liquidity support program and settled on October 28.
The size is the point. The $6 billion accepted is 70 percent above the $3.519 billion average accepted across the previous four operations in the same 20 year to 30 year bucket, and a full take of the stated maximum is not the routine outcome for these operations. Across October as a whole, Treasury has now accepted $26.077 billion over six buyback operations, per the Fiscal Data operations record.
Liquidity support buybacks retire older, less traded off-the-run securities and are funded with new issuance, so they do not change the total stock of debt. What they change is the composition of the long end: $6 billion of the least liquid long coupons came out of the market in one operation, on a day when the Federal Reserve held its policy rate and the 30 year Treasury yield stood near 5.30 percent at the most recent close in this site’s market tables.