Indirect Bidder

An indirect bidder is a financial institution or investor that submits bids for government securities, such as Treasury bonds or notes, through an intermediary like a primary dealer, rather than participating directly in the auction. Indirect bidders often include foreign central banks, pension funds, and large institutional investors. The level of participation by indirect bidders can signal demand for government securities from foreign or institutional sources, which can affect yields and market sentiment.

Example

A foreign central bank acts as an indirect bidder, purchasing U.S. Treasury bonds through a primary dealer rather than participating directly in the Treasury auction.