US Increases Quarterly Debt Sale, Sees No More Boosts Coming

The US Treasury boosted the size of its quarterly issuance of longer-term debt for a third straight time, and suggested that no more increases are likely until next year.

The Treasury Department said in a statement Wednesday it will sell $121 billion of longer-term securities at its so-called quarterly refunding auctions next week, which span 3-, 10- and 30-year Treasuries. That matches what most dealers expected, and mirrored the cadence of increases unveiled at the last refunding, in November.

“Based on current projected borrowing needs, Treasury does not anticipate needing to make any further increases in nominal coupon or floating-rate note auction sizes, beyond those being announced today, for at least the next several quarters,” the department said.

Relief from further boosts to auction sizes for longer-term securities may help support demand for Treasuries. Investors for several months now have been particularly sensitive to news on the overall supply of federal debt, at a time when the Federal Reserve has been steadily shrinking its own holdings of US securities.

The Treasury also said Wednesday that it will announce the start-date for its new buyback program in the May refunding announcement, after conducting some small-value operations in April. That program is designed to help the department with its cash management and to improve liquidity for non-benchmark debt.