The Treasury Department will sell $125 billion of notes and bonds next week and left the size of its regular debt auctions unchanged, but it softened its pledge to keep them steady and sharply expanded its program to buy back older securities.
The quarterly refunding, announced Wednesday, consists of $58 billion of 3-year notes to be auctioned Nov. 9, $42 billion of 10-year notes on Nov. 10 and $25 billion of 30-year bonds on Nov. 12, all settling Nov. 16. The sales will refund about $97 billion of maturing securities and raise roughly $28 billion of new cash. The announcement follows Treasury’s estimate earlier this week that it expects to borrow $618 billion in the October-December quarter.
A subtle shift in guidance
Treasury again said it expects to keep coupon and floating-rate note auction sizes unchanged for the next several quarters, but it dropped the qualifier that had said this would hold for at least that long. Its borrowing advisory committee of dealers and investors went further, saying increases would likely be warranted in the second half of fiscal 2027 and should be concentrated in maturities of 2 to 10 years. Members also discussed possible changes to 20-year and 30-year issuance.
More buybacks, fewer 7-year auctions
The bigger change came in buybacks. Treasury plans to repurchase as much as $70 billion of older, less-traded securities for liquidity support this quarter, up from as much as $38 billion in August, an increase of about 84%, plus up to $25 billion of short-dated securities for cash management. It also said the 7-year note will become a quarterly new issue with two monthly reopenings, starting with the March 2027 sale.
TIPS sizes were held steady, with a $19 billion 10-year reopening in November. Treasury said it would handle seasonal swings in borrowing through bill auctions and cash-management bills. The next refunding announcement is scheduled for Feb. 3, 2027.
