The recent quarterly refunding announcement from the US Treasury under the leadership of Scott Bessent, the new Treasury Secretary, has shown that the composition of debt being issued has remained the same as under previous leadership. Despite previous criticism from Bessent regarding the need for longer-duration debt to be issued, the current strategy of issuing more bills compared to coupons has been maintained. The Treasury also decided to keep the forward guidance on issuance sizes, despite recommendations to remove or modify it. This suggests that there is a lack of structural demand for long-duration bonds and concerns about fiscal deficits. The takeaway from this announcement is that there has been no change in the composition of debt issuance under the new Treasury Secretary.



Other News from Today