The U.S. Treasury Department on Wednesday said it plans to "gradually" increase the size of most of its debt auctions in the November 2023 to January 2024 quarter and expects it will need one more additional quarter of increases after this to meet its financing needs.
It plans to sell $112 billion in its quarterly refunding next week, which will raise $9.8 billion in new cash and refund $102.2 billion in securities. This will include $48 billion in three-year notes, $40 billion in 10-year notes and $24 billion in 30-year bonds.
The Treasury said it plans to increase the size of its two-year and five-year auctions by $3 billion per month, and to increase the size of its 3-year and 7-year auctions by $2 billion and $1 billion per month, respectively.
It will increase the size of its 10-year new issue and reopenings by $2 billion and raise its $30-year bond new issue and reopenings by $1 billion. The 20-year bond auction sizes will remain unchanged.
The Treasury will also increase the size of its two-year floating rate note new issue and reopenings by $2 billion.
Some Treasury Inflation-Protected Securities (TIPS) auction sizes will also be increased, with a $1 billion increase in the December 5-year TIPS auction and January 10-year TIPS auction.
The Treasury also said it expects to implement "modest reductions" to short-dated bill auctions by early December, which are expected to be maintained through mid- to late-January. The bill auctions will be held at current levels through late in November.
It is also considering changing its regular 6-week cash management bill to a benchmark, and will announce this decision at the next refunding. The Treasury added that it continues to make "significant progress" on its plans to launch a regular buyback program in 2024.
(Reporting By Karen Brettell; Editing by Paul Simao)
