US Treasury Maintains Long-Term Borrowing Levels Through January

The United States Department of the Treasury announced Wednesday that it will maintain long-term borrowing levels and coupon auction sizes for the period spanning November through January, as well as for several subsequent quarters. The department is offering $125 billion to refund approximately $97 billion of maturing debt, a move expected to generate $28 billion in new cash.

As part of a structural shift, the Treasury is converting the seven-year note from a monthly new issue to a quarterly new issue with two reopenings. This change aligns the seven-year note with the existing structure of the ten-year note.

These decisions occur despite market expectations that the government would decrease long-term borrowing in favor of higher bill issuance over the coming year. Hunter McMaster, the Assistant Secretary for Financial Markets, noted that the department continues to evaluate potential future changes to auction sizes by focusing on structural demand and the associated costs and risks of different issuance profiles.