Coupon Size Increases And Bill Trajectory As Expected

Some initial takeaways from today's Quarterly Refunding Announcement (Treasury link here):

• Treasury's coupon upsizing for the upcoming quarter was exactly as MNI (and consensus) had anticipated, as was the unchanged guidance (does not anticipate needing to make any further increases...for at least the next several quarters).
• A modest surprise for some observers that they aren't launching buybacks immediately, but certainly not a major surprise as they will be coming "later this year" after tests in April with an announcement coming in May.
• On bills, the broad strokes seem to be as expected: "Given current fiscal forecasts, Treasury expects to maintain bill auction sizes at current levels into late-March. Treasury anticipates that this will likely result in a $300-350 billion net increase to privately-held supply over the next two months. By late-March or early-April, Treasury anticipates modestly reducing short-dated bill auction sizes going into the tax filing season. These reductions will likely lead to a $100-150 billion net reduction to privately-held supply during the month of April. "