US Treasury Keeps Issuance Guidance, Sets $125 Billion Auctions, Lifts Borrowing Estimate to $739 Billion
The US Treasury maintained its quarterly debt issuance guidance, keeping auction sizes unchanged through 2027. It will sell $125 billion in notes and bonds next week, raising about $28.7 billion in new cash. The Treasury also raised its current-quarter borrowing estimate to $739 billion and reiterated its preference for short-dated issues if it increases coupon supply. It continues to monitor rising demand for Treasury bills. Separately, total US public debt is set to reach $40 trillion within two weeks.
The US Treasury, in its latest quarterly refunding report, maintained its previous guidance for future bond issuance, with no changes to auction sizes for Treasury notes and bonds, a schedule that extends through 2027. In the report released this morning, the department said it would continue to keep the current sales of nominal coupon securities and floating-rate notes "at least for the next few quarters," consistent with the language used in its quarterly debt issuance strategy statements since early 2024. Next week, the Treasury will conduct $125 billion in refunding auctions, comprising $58 billion of 3-year notes on August 11, $42 billion of 10-year notes on August 12, and $25 billion of 30-year bonds on August 13. The Treasury said the refunding will raise approximately $28.7 billion in new cash.
The Treasury also retained its preference, first expressed in May, to prioritize the short end of the yield curve if it were to increase issuance of coupon-bearing debt in the future. The Treasury said it is monitoring the growth in demand for Treasury bills and continues to assess the situation, focusing on structural demand trends as well as potential costs and risks under different issuance structures. Because it has not increased coupon issuance, the Treasury's reliance on securities with maturities of one year or less, such as Treasury bills, will deepen further.
Separately, public data show the total US national debt is set to reach $40 trillion within two weeks. Currently, demand for Treasury bills from money market funds and institutions such as the Federal Reserve remains strong; the Fed has been rolling over maturing mortgage-backed securities into Treasury bills.