US Treasury Lifts July-September Borrowing Estimate to $1 Trillion

The U.S. Treasury sharply increased its estimate for net marketable borrowing in the current quarter, saying it now expects to raise $1.007 trillion between July and September. The revised figure is $453 billion higher than the projection issued in April and assumes the government finishes September with $850 billion in cash. Treasury officials attributed the larger borrowing need to a lower-than-expected cash balance at the start of the quarter and weaker projected net cash flows. The department ended June with $457 billion in cash after borrowing $65 billion during the second quarter, well below the $850 billion level it had planned for three months earlier. For the October–December quarter, the Treasury foresees borrowing $590 billion while maintaining the cash balance at $850 billion. Earlier this month the department said it would rebuild its cash holdings to $500 billion by the end of July following the recent increase in the federal debt limit, and the latest projections show the cash position continuing to expand into the autumn.