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US TSYS/SUPPLY: Q1 Cash Balance Est Doesn't Reflect Debt Limit Reality (2/2)

US TSYS/SUPPLY
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The only surprise of note here is that Treasury is aiming for a $850B end-Q1 2025 cash balance of $850B, which is at the high end of expectations. That also means that the marketable borrowing estimates are a little toward on the high end at $823B.

  • But  also that - as expected - "The end-of-March cash balance assumes enactment of a debt limit suspension or increase. While the debt limit is not currently binding, Treasury’s cash balance may be lower than assumed depending on several factors, including constraints related to the debt limit."
  • So in other words, the $850B cash balance pencilled in for end-Q1 is just a placeholder - if the debt limit isn't lifted by end-March, that figure will be much lower as Treasury draws down cash on hand.
  • The cash balance (TGA) closed Friday at $834B.
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The only surprise of note here is that Treasury is aiming for a $850B end-Q1 2025 cash balance of $850B, which is at the high end of expectations. That also means that the marketable borrowing estimates are a little toward on the high end at $823B.

  • But  also that - as expected - "The end-of-March cash balance assumes enactment of a debt limit suspension or increase. While the debt limit is not currently binding, Treasury’s cash balance may be lower than assumed depending on several factors, including constraints related to the debt limit."
  • So in other words, the $850B cash balance pencilled in for end-Q1 is just a placeholder - if the debt limit isn't lifted by end-March, that figure will be much lower as Treasury draws down cash on hand.
  • The cash balance (TGA) closed Friday at $834B.