The U.S. Treasury is expected to announce plans to increase the size of auctions for bills, notes, and bonds in order to fund a worsening budget deficit. Concerns about the deficit have contributed to a sharp rise in long-term Treasury yields.
NEW YORK - The U.S. Treasury is likely to boost the size of auctions for bills, notes, and bonds in the fourth quarter when it announces its financing plans this week to fund a worsening budget deficit , analysts said.
The budget deficit is increasing due to several factors, including higher federal government borrowing costs arising from the Federal Reserve's interest rate increases and quantitative tightening. The Treasury will release its quarterly borrowing requirements on Monday at 3 p.m. ET and its refunding news on Wednesday at 8:30 a.m. ET .
Morgan Stanley's Dhingra, who expects the Treasury to rely on T-bills to finance its budget needs, said such a move could push the percentage of T-bills as a share of outstanding U.S. debt to around 22%. That is slightly higher than the 15% to 20% range adopted by the Treasury. "But the government doesn't want to lean too heavily on the longer end of the curve to finance the deficit," said Zachary Griffiths, senior investment grade strategist at CreditSights in Charlotte, North Carolina, adding that there was a need for a "balance-of-risk approach.CIBC and TD Bank are intriguing bank stocks that are worth owning on the way down. The post Best Bank for Your Buck: 2 Canadian Bank Stocks I’m So Close to Buying appeared first on The Motley Fool Canada.
U.S. Treasury Auctions Bills Notes Bonds Budget Deficit Fiscal Deficit Treasury Yields Borrowing Costs Federal Reserve Interest Rate Increases Quantitative Tightening
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