MNI BRIEF: US Treasury Reduces Q3 Borrowing Estimate to $673B

The U.S. Treasury said Monday it plans to borrow USD673 billion in the third quarter, down USD148 billion from the May estimate of USD821 billion, as the agency adjusts to Biden administration fiscal priorities and a re-imposed debt ceiling.

The third-quarter estimate assumes an end-of-September cash balance of USD750 billion, the Treasury said in a statement, and estimates assume enactment of a debt limit suspension or increase. The Treasury said it issued USD319 billion in net debt in the second quarter and expects to borrow USD703 billion in the October to December quarter, assuming an end-of-December cash balance of USD800 billion.

Treasury Secretary Janet Yellen has written to congressional leaders warning of the need to address the debt ceiling, writing that delaying action could pose "irreparable harm to the U.S. economy and the livelihoods of all Americans." The nonpartisan Congressional Budget Office has said "extraordinary measures" are likely to prevent the U.S. from defaulting on its debt until October or even November.