Delivery fails involving 10-year Treasury notes surged to the highest level in eight years this month, a result of the Federal Reserve’s move to shrink its bond portfolio since 2022.
Trades involving the most recently issued 10-year note that failed to settle on schedule totaled $30.5 billion during the week ended Dec. 10, the most since December 2017, recent data from the New York Fed show.
Fails that week occurred amid a collapse in interest rates available to owners of the newest 10-year note, which was created via a $42 billion auction on Nov. 12. Holders willing to lend the ...