Press Releases

Quarterly Refunding Statement of Acting Assistant Secretary For Financial Markets Seth B. Carpenter

(Archived Content)

WASHINGTON – The U.S. Department of the Treasury is offering $64 billion of Treasury securities to refund approximately $60.4 billion of privately-held Treasury notes maturing on November 15, 2015.  This will raise new cash of approximately $3.6 billion.  The securities are:
-        A 3-year note in the amount of $24 billion, maturing November 15, 2018;
-        A 10-year note in the amount of $24 billion, maturing November 15, 2025; and
-        A 30-year bond in the amount of $16 billion, maturing November 15, 2045.
The 3-year note will be auctioned on a yield basis at 1:00 p.m. ET on Monday, November 9, 2015.  The 10-year note will be auctioned on a yield basis at 1:00 p.m. ET on Tuesday, November 10, 2015.  The 30-year bond will be auctioned on a yield basis at 1:00 p.m. ET on Thursday, November 12, 2015.  All of these auctions will settle on Monday, November 16, 2015. 
The balance of Treasury financing requirements will be met with the weekly bill auctions, cash management bills, the monthly note and bond auctions, the November 10-year Treasury Inflation Protected Security (TIPS) reopening auction, the December 5-year TIPS reopening auction, the January 10-year TIPS auction, and the regular monthly 2-year Floating Rate Note (FRN) auctions.
Projected Financing Needs Over the Next Quarter
Based on current fiscal forecasts, Treasury intends to maintain coupon, TIPS, and FRN issuance sizes at current levels over the upcoming quarter.  Treasury will continue to monitor projected financing needs and make appropriate adjustments as necessary. 
Cash Balance
Congress recently passed legislation suspending the debt limit through March 15, 2017.  Over the next several weeks, Treasury will raise its cash balance back to a minimum prudent level primarily through increased Treasury bill issuance.  Consistent with the cash balance framework announced at the May refunding, Treasury will hold a sufficient amount of cash to cover one week of outflows, subject to a minimum balance of roughly $150 billion. 
Bill Supply
At the May 2015 Quarterly Refunding, Treasury stated its intention to increase bill issuance.  At the August 2015 Quarterly Refunding, Treasury reiterated that intention and noted that implementation of this action would be constrained until the debt limit impasse was resolved.   
The supply of bills outstanding as a percentage of the total Treasury portfolio is at a multi-decade low of approximately 10 percent.  Demand for Treasury bills is high and is expected to continue to grow.  Therefore, Treasury believes that it is prudent to increase the level of Treasury bills outstanding over the coming quarters.  As Treasury has previously indicated, the increase in bill issuance will help achieve our objective of lowest cost of funding over time and will also enhance market functioning and liquidity. 
The magnitude and timing of the increases in bill issuance are subject to a number of variables including deficit forecasts, potential adjustments to the coupon issuance calendar, and other funding needs.  Given Treasury’s commitment to increasing bill supply, adjustments in coupon offering sizes may be necessary in order to increase bill issuance sufficiently in 2016.  Treasury will provide more guidance in the future.
2-Month Bill Considerations
Consistent with a recommendation from the Treasury Borrowing Advisory Committee (TBAC) in May 2015, Treasury is considering whether to add a 2-month bill maturity point to the suite of bill securities that it currently offers.  Treasury will study this matter in the upcoming quarters before making any decision about 2-month bill issuance.  Treasury welcomes feedback from market participants on this topic.
Test Buyback Operation
Treasury has successfully conducted two test buyback operations over the past year.  Treasury believes that it is prudent to test the existing IT infrastructure periodically to ensure that the buyback functionality remains operational.  Within the next six months, Treasury will conduct another small-value buyback operation to continue testing the buyback infrastructure.  Details of such an operation will be announced at a later date.
These small-scale buyback operations should not be viewed by market participants as a precursor or signal of any pending policy changes regarding Treasury’s use of buybacks.
Please send comments and suggestions on these subjects or others related to debt management to  The next quarterly refunding announcement will take place on Wednesday, February 3, 2016.