Morgan Chase: The United States Treasury is not expected to adjust its bond issuance plans for the midterm elections

On 29 July, Chase Morgan predicted that the United States Treasury Department would release a quarterly refinancing plan next week, avoiding adjustments that might imply that bond issues would be expanded in the future to avoid disturbing the bond market before the mid-November elections. Morgan Chase expects a $3.7 trillion funding gap for the next four fiscal years, which means that officials should adjust their long-term guidance on the size of the auction to achieve the Treasury's goal of “prudential debt management”, specifically by deleting the word “at least” from the phrase “expected to stabilize the size of the auction for at least the next few quarters”. In practical terms, however, political considerations will become more important. If the Ministry of Finance releases signals of future increases in the supply of long-term national debt at this time, it may push up the long-term United States debt return, which is now close to Trump ' s pre-election high, to the detriment of market stability。