Boring Is Beautiful to U.S. Treasury Shunning Latest Bond Craze
- Nation trails peers in duration amid ultra-long issuance trend
- For U.S. policy makers, it’s about regular, predictable sales
WASHINGTON, DC - MARCH 24: Sheets of one dollar bills run through the printing press at the Bureau of Engraving and Printing on March 24, 2015 in Washington, DC. The roots of The Bureau of Engraving and Printing can be traced back to 1862, when a single room was used in the basement of the main Treasury building before moving to its current location on 14th Street in 1864. The Washington printing facility has been responsible for printing all of the paper Federal Reserve notes up until 1991 when it shared the printing responsibilities with a new western facility that opened in Fort Worth, Texas.
Photographer: Mark Wilson/Getty ImagesThe U.S. Treasuries market is a world-beater when it comes to sheer size, depth and liquidity. Yet in one area it’s falling behind.
To lock in historically low interest rates, Belgium, Canada, France, Mexico, Spain, Switzerland and the U.K. have all sold debt maturing in 40 to 100 years since 2014, even if infrequently. Not the U.S., which in the interest of keeping sales regular has stuck to securities of three decades or less. That policy has made the globe’s biggest debtor a laggard in a key bond-market metric related to the average maturity of its securities. By this measure, the gap between the U.S. and its peers has never been wider.