Halister News

(Bloomberg) -- Ultra-long bond issuance would be “out of step” with the Treasury’s long-standing principles of being “regular and predictable,” if locking in low rates is the main purpose for the move, Goldman Sachs economists led by David Mericle say in note.

• While European sovereigns have issued ultra-long bonds, they have done so “erratically and opportunistically”
  • Total foreign issuance of 50Y debt amounted to one-third of Treasury’s 30Y supply in 2016
• Treasury’s survey likely to draw “skeptical feedback” from dealers about market demand as 50Y duration is similar to that on already-available 30Y strips
• The Trump Administration’s interest in an ultra-long bond appears “largely tied” to funding an infrastructure program that may not materialize