U.S. Treasury Sales Are About to Double 2018. Who's Buying?
- Onus may shift to price-sensitive investors like hedge funds
- If central banks step back, that could mean higher yields
The U.S. Treasury stands in Washington, D.C.
Photographer: Andrew Harrer/BloombergThis article is for subscribers only.
With the U.S. about to sell the most debt in eight years, Treasury Secretary Steven Mnuchin may find himself relying on a buyer base that needs to see higher yields before loading up.
Government debt sales are set to more than double in 2018, lifting net issuance to $1.3 trillion, the most since 2010, according to JPMorgan Chase & Co. estimates. With the Federal Reserve shrinking its bond holdings and deficits poised to swell even before taking into account the tax overhaul, all signs point to higher financing costs.