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30-Year TIPS Auction: Still Looks Too Risky

The U.S. Treasury announced last week that it will offer $5 billion in an October 18 auction of a reopened 30-year TIPS, CUSIP 912810SB5. The resulting Treasury Inflation-Protected Security will have a term of 29 years, 4 months.

This TIPS originally auctioned on February 15 with a real yield to maturity of 1.003%, which set the coupon rate at 1.0% It then was reopened on June 21, when the…