MNI does not expect any change in nominal coupon sizes to be announced in November - more important is forward guidance.
MNI usually produces a Deep Dive ahead of the Refunding announcement, recapping then previous month's auctions, but in this case Treasury auctions continue through Tuesday. Unusually, for this round, we published a preview last Wednesday Oct 23, which is updated in the PDF below with latest analyst expectations - and we will publish a Deep Dive covering the Refunding results after their release.
PDF Here:
- MNI does not expect any change in nominal coupon sizes to be announced (though there might be a small $1B uptick in 5Y/10Y TIPS) for Nov-Dec-Jan.
- More important will be whether the guidance itself changes, to indicate potential for higher issuance in coming quarters. That would be considered a surprise, particularly as it would be conveyed less than a week before the Nov 5 elections. Some see a softening in guidance to open up the possibility of future increases, which would come as an unwelcome surprise to markets.
- Broad consensus is that the next upsizing will not come until late 2025 or even early 2026 though of course much will depend on the fiscal path taken in the next administration/Congress.
- The second major outcome from the Refunding process are the financing estimates for calendar Q4 (Oct-Dec) and Q1 2025 (Jan-Mar) which are out Monday at 1500ET. Overall it will be tricky to get a read of Treasury's actual operating intentions for Q1 and beyond, since they are likely to assume for forecasting purposes that the debt limit will be lifted by Congress.
307 words