Treasury Cuts Quarterly Debt Sale, May Do So Again Even With Fed QT
- Treasury scales back coupon security sales across maturities
- Dealers hadn’t anticipated hint of further reductions to come
The U.S. Treasury building in Washington, D.C.
Photographer: Samuel Corum/BloombergThis article is for subscribers only.
The U.S. Treasury trimmed its quarterly sale of longer-term debt for a third straight time, and unexpectedly advised that it may make further reductions, citing “strong” federal tax revenues.
Dealers had widely expected the reduction to next week’s sale of notes and bonds, but viewed it as likely to be the last cutback ahead of the Federal Reserve’s move to shrink its $5.8 trillion stockpile of Treasuries. The Fed is forecast to unveil its plan for so-called quantitative tightening, or QT, later Wednesday, and that process was seen forcing the Treasury to have to sell more debt to the public.