The U.S. Treasury kept planned nominal coupon and floating-rate note (FRN) auction sizes at current levels through January and changed its seven-year note schedule, giving investors near-term supply details while leaving later increases undecided.
In its Nov. 4 quarterly refunding statement, Treasury said it expects to keep those sizes in place for “the next several quarters,” dropping “at least” from its August wording. It set no date for a future change and announced no increases to nominal coupon or FRN sizes. The department said later decisions will weigh investor demand and the costs and risks of different borrowing mixes, with the aim of financing the government at the lowest cost over time.
The statement also changes how Treasury will issue seven-year notes. Starting in March 2027, it plans to sell a new issue once per quarter, then reopen that issue in April and May.
For the current refunding, about $97 billion of the offering will replace securities maturing Nov. 15, while roughly $28 billion will provide new cash from private investors. The three auctions total $125 billion: $58 billion in three-year notes Monday, Nov. 9; $42 billion in 10-year notes Tuesday, Nov. 10; and $25 billion in 30-year bonds Thursday, Nov. 12. Each is scheduled for 1 p.m. ET.
The Treasury Borrowing Advisory Committee (TBAC) unanimously recommended keeping nominal coupon, FRN and Treasury Inflation-Protected Securities auction sizes at current levels for the quarter. Its minutes say coupon increases would likely be appropriate in the second half of fiscal 2027. Members generally favored concentrating added issuance in maturities from two to 10 years and discussed possible future changes to 20- and 30-year offerings; Treasury announced no cuts to those sales.
Treasury estimated privately held net marketable borrowing at $618 billion for October-December 2026 and $800 billion for January-March 2027, assuming quarter-end cash balances of $850 billion and $1 trillion, respectively. The latter figure was also part of Treasury’s first-quarter 2027 borrowing estimate. TBAC minutes describe a modest fiscal 2027 funding shortfall against projected needs that bill sales could likely manage. The median primary-dealer forecast puts the shortfall at $2.14 trillion for fiscal 2028-2029, assuming current coupon auction sizes and privately held bill supply.
Treasury expects to reduce shorter-dated bill sizes in December, citing projected mid-December corporate and non-withheld tax receipts, then increase sizes across the bill curve in January amid seasonal fiscal outflows. The next quarterly refunding announcement is scheduled for Feb. 3, 2027.
