MNI BRIEF: US Treasury Raises Q4 Borrowing Estimate by USD312B

The U.S. Treasury Department on Monday announced it expects to borrow USD1.015 trillion in privately-held net marketable debt in the fourth quarter, USD312 billion more than previously announced in August.

Treasury is assuming a cash balance of approximately USD650 billion at the end of December, down USD150 billion from the assumption made in August. For the first quarter in 2022, Treasury plans to borrow USD476 billion, assuming an end-of-March cash balance of USD650 billion. The Treasury's quarterly refunding, which is expected to show coupon cuts, will be released at 8:30 a.m. November 3.

The Treasury estimates, however, come with more uncertainty than normal. Congress is still debating how it will resolve the year's spending bills that need to be addressed by December 3 or face a government shutdown, and the next debt ceiling fix that needs to be addressed in December or January. As of Friday, Treasury has USD288 billion of USD375 billion in "extraordinary measures" remaining and has a USD260 billion cash balance.