US treasury expects to borrow a record $3 trillion in the second quarter

PTI

Washington, District of Columbia, United States of AmericaUpdated: May 05, 2020, 10:17 AM IST

March 16, 2022: The central bank raised interest rates for the first time since 2018 to the 0.25-0.50 percent range. April 6, 2022: The minutes from the Fed's March policy meeting are released, showing that many participants see one or more 50-basis point rate hikes as necessary if inflation pressure continues. April 29, 2022: The Fed's preferred inflation gauge, the personal consumption expenditures price index, rises 6.6 percent year-on-year and 0.9 percent month-on-month in March, both faster paces than the month prior. Photograph:(AFP)

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In a statement, Treasury said it would borrow $2.999 trillion during the April-June quarter, $3.055 trillion more than its previous estimate, assuming an end-June cash balance of $800 billion.

The US Treasury Department on Monday said it plans to borrow nearly $3 trillion in the second quarter of 2020 - a record for any quarter - as the federal government contends with the impact of the coronavirus.

In a statement, Treasury said it would borrow $2.999 trillion during the April-June quarter, $3.055 trillion more than its previous estimate, assuming an end-June cash balance of $800 billion.

“It is larger than what we would typically do in a year,” a senior Treasury official said. The Treasury’s net borrowing last fiscal year, for example, was $1.28 trillion.

In February, Treasury said it expected to pay down $56 billion in net marketable debt in the April-June period.

Treasury said it expects to borrow $677 billion during the July-September quarter, assuming an end-September cash balance of $800 billion.

It borrowed $477 billion through credit markets in the January-March quarter, ending the period with $515 billion in cash.

Additional details of Treasury’s quarterly refunding will be announced at 08:30 a.m (1230 GMT) on Wednesday. In February, Treasury said it would announce details of a planned new 20-year bond in May.