US CREDIT UPDATE: Banks: Week in Review – September 11, 2026

Treasury reported a July federal budget deficit of $432.3B, which was above the Bloomberg analyst consensus of $346B coming into the week, but in-line with the $431B estimate by the Congressional Budget Office on Monday. 

• This was the single largest monthly deficit since 2021, and a record for a July, though timing of outlays was a factor. The deficit was around $140B bigger than in July 2025, but about $100B of that can be accounted for by spending that occurred in Aug 1 last year but happened in July this year. That being the case, the comparable deficit was "only" $40B wider this year, and August's should look more favorable than 2025's $344B shortfall.
• But bigger picture, tariff refunds among other factors are leading to a ballooning deficit, after relatively decent outturns for most of the year through June vs prior years (especially compared to GDP). In July 2026, receipts were $334B, $4.5B below the prior year's due to a sharp decline in net customs duties on account of the Supreme Court's February decision to strike them down. Refunds exceeded gross collections by $36B to $26B, for a net -$10B; that was compared to a $28B net collection in July 2025.
• It leaves the cumulative deficit through the first 10 months of FY2026 at just under $1.8T, up close to $170B vs the cumulative deficit over the same period of the prior year. Again while that's partly due to the timing shift in August vs July outlays, reduced net tariff revenue will take a toll.
• Per the CBO: "Based on information available through the end of July, CBO estimates that the fiscal year 2026 deficit will be $2.1 trillion—$200 billion more than the $1.9 trillion deficit projection that CBO published on February 11, 2026. CBO expects 2026 outlays to be close to the February baseline amounts. Revenues, by contrast, are anticipated to be about $200 billion below the February projections, mostly because of smaller-than-expected collections of tariff duties." Within this, CBO estimates that customs duties collected will be $250B (60%) below earlier projections.
• The medium-term impact is due to be mitigated by replacement tariffs imposed after the Supreme Court decision, including so-called  301 tariffs, and CBO expects those "will replace a substantial share of the revenue that would have been collected from the tariffs in place before the Supreme Court’s decision". But instead of posting a nominal deficit roughly comparable to the prior two years (both around $1.8T), 2026 is likely to show the 3rd largest shortfall ever (after 2020 and 2021 around $3T each amid Covid responses).

• RES 4: 186.05 Low Jul 28
• RES 3: 185.56 76.4% retracement of the Jul 23 - Aug 3 bear leg
• RES 2: 184.58 50-day EMA
• RES 1: 183.99 20-day EMA
• PRICE: 183.76 @ 18:14 BST Aug 12
• SUP 1: 181.33/179.37 Low Aug 7 / 3 and key support 
• SUP 2: 178.82 High Oct 30 2025
• SUP 3: 177.15 Low Nov 10 2025 
• SUP 4: 175.29 38.2% retracement of the Feb 28 ‘25 - Apr 17 bull leg

EURJPY continues to retrace the sharp sell-off between the Jul 29 - Aug 3 period. For now, gains are considered corrective. The next resistance points to monitor are 183.99, the 20-day EMA, and 184.58, the 50-day EMA. A clear break through this resistance zone would strengthen the current bounce. For bears, a reversal lower would refocus attention on 179.37, the Aug 3 low and key short-term support. 

• Date $MM Issuer (Priced *, Launch #)
• 08/12 $2B #Haleon US $600M 3Y +48, $600M 5Y +60, $800M 10Y +80
• 08/12 $1.75B #Wells Fargo PerpNC5 6.55%
• 08/12 $1B *Alexandria Real Estate 30.5NC5.25 7.25%
• 08/12 $1B #Public Service of Oklahoma $450M 7Y +90, $550M 30Y +112
• Expected Thursday:
• 08/13 $2.25B Zenith Arc LLC 5NC2