After two mediocre, tailing auctions earlier this week, the Treasury concluded the sale of coupon paper this week with a bang, selling $16BN in Notes in a 30Y reopening with a bang.

The high yield of 3.165% stopped through the When Issued by 0.2bps, a far cry from last month's 2.3bps tail, and the lowest yield for the long bond since September as the curve has repriced the newly dovish Fed as well as the growing economic slowdown in the US.

The Bid to Cover meanwhile jumped from last month's 2.058, one of the lowest on record, to 2.308%, right on top of the 6 auction average.

However, the surprise - as has been the case recently - was in the internals, where as noted previously the mystery slump in Direct takedown is now long gone, and in December, Directs took down 11.5%, up sizably from 2.9% in November, and above the 9.3% auction average. And while Indirect demand was solid worth 66.4% of the auction, the highest takedown since January's 71.5%, it was Primary Dealers that was the outlier this time, as in December they were left with just 22.1% of the auction, the second lowest allotment on record.

Overall, surprisingly aggressive demand for 30Y paper especially in light of recent relatively poor auctions, and the clearest indicator yet that according to the buy side the US economy is clearly slowing down.

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