US non-comp bids for four-month bills at $451.1 mln

US non-comp bids for four-month bills at $451.1 mln

US Treasury Auction Sees $451.1 Million in Non-Competitive Bids for Four-Month Bills

The U.S. Treasury's recent auction of four-month bills attracted $451.1 million in non-competitive bids, reflecting sustained investor demand for short-term government debt. Non-competitive bids, which allow investors to purchase securities at the auction's accepted rate without influencing the outcome, accounted for approximately 6.5% of the $6.9 billion offering size.

The auction, held on February 12, 2026, saw a bid-cover ratio of 2.97, indicating moderate but stable demand. The high rate accepted was 3.595%, up slightly from 3.590% in the prior week's auction. This aligns with broader trends of rising yields on short-term Treasuries, driven by the Treasury's aggressive borrowing strategy to rebuild its cash balance following the July 2025 debt ceiling resolution.

The Treasury has increasingly prioritized short-term securities, such as four-week and four-month bills, to manage borrowing costs amid elevated long-term yields. Secretary Scott Bessent has emphasized avoiding larger sales of longer-dated debt, which carry higher interest expenses. Analysts anticipate further growth in bill issuance, with TD Securities' Gennadiy Goldberg noting that "bill auction sizes are only likely to grow further" in the coming years.

Non-competitive bids remain a critical component of Treasury auctions, particularly for individual investors and money-market funds seeking liquidity. These bids ensure access to Treasuries without requiring competitive pricing strategies. With U.S. money-market funds holding $7.4 trillion in assets, demand for short-term, low-risk securities like T-bills remains robust.

The latest auction underscores the Treasury's reliance on short-term debt to fund the federal deficit, a strategy expected to continue as policymakers balance fiscal needs with market stability. While concerns about oversupply persist, current demand metrics suggest no immediate disruption to the Treasury's borrowing plans.

[^NUMBER]: Citations correspond to source materials provided.