November 20, 2014 / 8:08 PM / in 3 years

Solid demand emerges for U.S. 10-year TIPS supply

NEW YORK, Nov 20 (Reuters) - Investors and foreign central banks put in solid bids for $13 billion of 10-year Treasury Inflation-Protected Securities on Thursday after earlier data on October U.S. consumer prices reduced anxiety about weak price growth.

Relatively strong demand helped the U.S. Treasury Department to sell the latest TIPS supply at a yield 0.497 percent , more than half a basis point below what traders had expected.

Overseas central banks, large investors and other indirect bidders purchased 62.38 percent of the 10-year TIPS supply, their biggest share in three auctions.

Direct bidders which include smaller bond dealers bought 8.08 percent at the auction, up from 5.66 percent at the previous 10-year TIPS auction in September.

Primary dealers or the 22 Wall Street firms that do business directly with the Federal Reserve, purchased 29.54 percent, which was their second-smallest share on record, analysts said. (Reporting by Richard Leong; Editing by James Dalgleish)

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