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There's a Big Drop in U.S. Treasury Debt Supply Coming in 2016

  • Wall Street bond dealers predict 27% decrease in net issuance
  • Drop-off may keep a lid on long-term U.S. yields as Fed looms
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Why Treasury Market Supply Is Falling

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Lost in the debate over the U.S. Treasury market’s resilience as the Federal Reserve starts to raise interest rates is one simple fact: supply is falling -- and fast.

Net issuance of U.S. notes and bonds will tumble 27 percent next year, according to estimates by primary dealers that are obligated to bid at Treasury debt auctions. The $418 billion of new supply would be the least since 2008.