Halister News

(Bloomberg) -- The suspension of the debt limit for only three months raises the risk that Treasury will wait until February to begin lifting coupon auction sizes as part of its steps to make up for lost funding from the Fed’s intent to wind down its balance sheet, JPM strategists led by Jay Barry said in a note.

• Given debt-ceiling only temporary fix, Treasury likely now only to ramp up bill supply enough to bring cash balance to about $195b by year-end, under its prior target of $360b
• JPM’s previous forecast for Treasury to begin increasing coupon auctions sizes for all nominal notes and bonds at its November refunding may ”get pushed back to the February announcement”

To contact the reporter on this story: Liz Capo McCormick in New York at emccormick7@bloomberg.net To contact the editors responsible for this story: Boris Korby at bkorby1@bloomberg.net Greg Chang