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of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
US TSYS/SUPPLY
The Treasury's quarterly refunding announcement contained some surprises versus expectations.
- First, the non-surprise: there are no planned changes to auction sizes in May/Jun/Jul vs the prior quarter. Table below. Also, Treasury said little new about the debt limit - Secretary Yellen provided the key message Monday, that the x-date could be reached as soon as Jun 1.
- The major surprise was that Treasury said it expects to begin a regular buyback program in 2024. The basic idea is that Treasury would buy back older coupons/TIPS across the curve, in order to improve liquidity and cash management. This could include weekly operations. Details from the Treasury on rationale and parameters are here.
- Potential for the first buyback program since 2000-2002 has been discussed with market participants since last November, but a program wasn't expected to be announced at this refunding, with several sell-side analysts doubting it would be implemented at all.
- Less of a surprise but still noteworthy was Treasury saying it may need to "modestly increase" auction sizes as soon as the August refunding announcement (which was confirmed for Weds Aug 2nd) - some analysts had expected such timing, though many thought it could wait until November or later.
Source: US Treasury
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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