Recent Treasury auctions, including the $42 billion 10Y note sale on May 12, have seen significant tails, reflecting cooling foreign demand and heightening concerns over deficit financing. With 30Y yields testing the 5% threshold, bond markets are increasingly pricing in a more restrictive policy outlook, pressured by the combination of sticky inflation and heavy supply. Key watch: The market remains highly sensitive to auction outcomes as a proxy for structural demand for US debt amid the Treasury’s ongoing quarterly refunding efforts.