Jefferies economist Tom Simons.......>

US TSYS/SUPPLY: Jefferies economist Tom Simons said US Treasury today "also

announced expected borrowing of $512 bln for Q1, with an end-of-quarter cash

balance of $300 bln. This is a massive projected borrowing figure, the likes of

which have not been seen since Q4 2008. It reflects a combination of

replenishing cash balances and bill supply after the debt ceiling constraints

are lifted, as well as public borrowing to offset the redemptions anticipated

from the Fed's Balance Sheet Normalization (BSN) process."

- He said "we had anticipated a more modest reduction in borrowing estimates in

Q4, as well as a more modest borrowing figure in Q1. The uncertainty surrounding

Congress's approach to the debt ceiling when the current suspension period ends

in early December makes it difficult for both Treasury and private forecasters

to put together accurate financing forecasts."