Long Treasury Yields Decline

In Wednesday's market trade, yields on long-term Treasury securities dropped across the line. Every note and bond came out of today's market with a lower yield than yesterday. Furthermore, the trend of market yields below auction yields is reinforced; the column farthest to the right reports the market yield per 100 points of yield at the latest auction:

Table 1

Source: U.S. Treasury

The drop in the 20-year yield coincides with the bond being sold at auction this morning for a yield that was substantially lower than at the October auction. 

In its daily updates on the U.S. debt, the Treasury reports that as of November 15, the federal government owes $31,288.2 billion. Our model estimates the average interest rate on this debt to be 2.06 percent.

On November 14, the total U.S. debt had increased by 0.34 percent in one month. During the same period of time, the estimated annualized interest cost on the same debt rose by 7.8 percent. The rate cost will continue to rise in the coming months, but more slowly.

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We do not give investment advice. 

This blog provides analytical information solely for the purposes of 1) predicting the cost of the federal debt, and 2) for assessing the risk for a U.S. fiscal crisis. All information published here, forecasting and other, is based on publicly available data from the U.S. Treasury, including but not limited to approximately 65 percent of the current debt; on macroeconomic data, including but not limited to monetary policy decisions by the Federal Reserve; and on macroeconomic theory.