US Treasury cuts fourth-quarter borrowing estimate to $618 billion
TLT•The US Treasury expects to borrow $618 billion in the fourth quarter, $10 billion less than projected in August, and $800 billion in the first quarter of 2027. The estimates assume cash balances of $850 billion at year-end and $1 trillion at the end of March, respectively.
1. Borrowing estimates
The US Treasury said it expects to borrow $618 billion in the fourth quarter, $10 billion less than its August estimate, due to a higher-than-assumed starting cash balance that is partly offset by lower projected net cash flows. Excluding the benefit of the larger starting cushion, borrowing needs are $24 billion above the August estimate. The Treasury projected $800 billion in borrowing for the first quarter of 2027.
2. Refunding plans ahead
The Treasury borrowed $742 billion in the third quarter and ended September with a $984 billion cash balance. It will detail its refunding plans on Wednesday, with traders watching for potential changes to auction sizes and buybacks. The Treasury has raised the maximum size of longer-dated buybacks to $6 billion per operation from $2 billion.
