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The Treasury Department said Monday it expects to pay down $26 billion in debt in the second quarter.
The announcement was unexpected. Three months ago, the department said it would have to borrow $66 billion in the April-June quarter. An unexpected increase in revenue allows the government to pay down debt this quarter, the department said. The updated forecast includes an end-of-quarter cash balance of $800 billion.
Borrowing is routinely less in the April-June quarter because of the mid-April deadline for individual taxpayers to file their returns.
Looking ahead, Treasury said it expects to borrow $182 billion in net marketable debt in the third quarter, with a cash balance of $650 billion.
In the January-March quarter, Treasury said it borrowed $668 billion and ended with a cash balance of $652 billion. This was lower than the previous estimate of $729 billion, which included a cash balance of $650 billion. The decrease was due to an increase in receipts and a decline in expenditures.
The yield on the 10-year Treasury note
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rose to 3% on Monday on the outlook for Fed monetary policy.
Additional financing details related to the Treasury’s quarterly refunding will be released at 8:30 a.m. Eastern on Wednesday.
