The US Treasury is doubling the size of its liquidity support buybacks for longer-dated debt while keeping its regular auction schedule completely untouched.
Steady auctions, bigger buybacks
The Treasury’s most recent quarterly refunding, dated August 5, confirmed that auction sizes remain unchanged. That means $58 billion in 3-year notes, $42 billion in 10-year notes, and $25 billion in 30-year bonds, totaling $125 billion.
Of that amount, roughly $96.3 billion goes toward refunding maturing securities. The remaining $28.7 billion represents net new borrowing.
The buybacks specifically target “off-the-run” securities, which is bond-market speak for older issues that don’t trade as frequently as the newest ones. These securities can become illiquid over time, sitting on dealer balance sheets and gumming up the plumbing of the Treasury market.
