GERMANY: The United States Treasury expects more active intervention in debt management

On 27 August, Deutsche Bank strategists indicated that, following the announcement of a doubling of the scale of long-term national debt buy-backs, the United States Treasury Department was expected to take a more proactive approach to debt management, moving forward through incremental adjustments rather than significant policy changes. “We also anticipate that the Ministry of Finance will increase communication beyond the quarterly refinancing arrangements and use the proactive release of policy signals more broadly as a policy tool. According to the strategist, the United States Department of the Treasury may use the flexibility retained in the wording of last week's bulletin to scale up long-term public debt buy-back operations to at least $4 billion as originally proposed. “Long-term national debt buy-backs usually attract up to $20 billion in bids, which provides considerable room for the Ministry of Finance to expand its operations in the near future. According to the strategist, the Ministry of Finance can also maintain operational flexibility by not clarifying the specific size of the long-term government debt buy-back operation at the time the updated arrangement is published。