The US Treasury announced it will hold bond auction sizes steady through at least the end of fiscal year 2026, in line with unanimous recommendations from the Treasury Borrowing Advisory Committee. In late March 2026, Treasury bill sales showed signs of weakness: the $69 billion 2-year note auction produced a bid-to-cover ratio of 2.44, well below the recent average of about 2.62, while primary dealers absorbed about 24% of that auction versus a historical average of 11%. The 10-year Treasury yield climbed from 4.0% at the end of February to above 4.4% by late March 2026. If auction sizes remain unchanged, the Treasury faces a projected funding shortfall of approximately $1.45 trillion across fiscal years 2027 and 2028.
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