NatWest Markets strategists said they were surprised the Treasury was issuing the 20-year now, while it would have made more sense two years ago when the Treasury was looking forward to larger auctions.

“While deficits are still running high, the current auction calendar should already cover most of those funding needs, with bills (which will largely be absorbed by the Fed) picking up the difference. Contrast this to 2017, when coupon issuance was set to rise significantly and a 20-year could have easily been added to the calendar without needing to scale back at any other point,” the NatWest strategists wrote in a note. “At that time, we had been strong advocates for a 20-year issue, and had even penciled one into our baseline forecasts. Now, with existing coupon auction sizes expected to remain flat, we had assumed the urgency to roll out a 20-year security would have waned.”