Treasury debt auction sizes to be cut in future

WASHINGTON — The U.S. Treasury Department plans to start scaling back the size of some of its government debt auctions, a sign that the government’s huge pandemic-driven borrowing needs are starting to ease.

The government began selling debt at accelerated levels to fund the trillion-dollar-plus support bills Congress started passing in the spring of 2020 after the pandemic-triggered shutdowns forced millions of people out of work.

Treasury on Wednesday released a schedule for auction sizes of securities ranging from two-year notes to 30-year bonds.

The reductions announced Wednesday would result in an $84 billion reduction in Treasury auctions from November through January 2022.

Over the next three months, the Treasury anticipates reducing the size of the two-year, three-year and five-year note auctions by $2 billion each on a monthly basis through the end of January.

Reductions in auction sizes were also announced for other government debt including 10-year notes and 30-year bonds.

In some cases, Treasury said some of these security auctions were “increased significantly more than others in response to the increase borrowing needs driven by the COVID-19 pandemic.”

The statement on reduced borrowing amounts for various Treasury securities came as part of the government’s regular quarterly refunding announcements when it disclosed the timing of a group of auctions held every quarter.

The Treasury auctions this quarter could be altered if Congress does not suspend or increase the debt limit.