Ministry of Finance adjusts strategy: Long-term bond issuance may become a necessity💁
With the Treasury having suffered through highly uncomfortable episodes of tight cashflow management during the recent debt-ceiling showdown, they have also announced that they would target to keep a higher % of cash on hand for liquidity management purposes going forward, and will continue to maximize the amount of borrowing needs being funded by the more flexible front-end T-bills market. However, the Treasury also maintains an internal 20% threshold limit of T-Bill funding vs longer-dated coupons, which has been hit, so additional funding needs will have to be borne by longer dated coupon issuances.
