MNI BRIEF: US Treasury Expects $26B In Pay Downs In Q2

The U.S. Treasury Department on Monday announced it expects to pay down USD26 billion in privately-held net marketable debt in the second quarter, USD92 billion lower than announced in January, and the first pay down since the second quarter of 2016.

The Treasury also announced it is assuming a higher end-of-quarter cash balance of USD800 billion, a hundred billion more than just a quarter ago, and higher because expected outflows as well as the timing of receipts. For the third quarter, Treasury plans to borrow USD182 billion, assuming an end-of-September cash balance of USD650 billion.

Treasury's estimates do not include impacts from the Federal Reserve and its plans to runoff assets from its books that could come starting in June. That could increase the Treasury's borrowing needs dollar-for-dollar, Treasury officials said on a call with reporters. The U.S. Treasury has seen higher than expected tax receipts recently, bringing the Treasury's cash balance to over USD950 billion. The Treasury's quarterly refunding will be released at 8:30 a.m. on Wednesday.