EU UTILITIES: Orsted: Fitch Outlook Negative    

Treasury will sell a record $100B in 4-week bills on Thursday, with a $5B increase that was not entirely unexpected in the context of the rebuild of the Treasury General Account.

• 4-month bill sizes will remain $65B (auctioned Weds Aug 6) while 8-week bills remain at $85B (auctioned Thu Aug 7 alongside 4-week). All settle on Aug 12 for a total $55B net cash raised.
• Treasury noted last month it would ramp up bill supply, and "specifically, the 4-, 6-, and 8-week bills", which it has done. Since the first week of July, when the debt limit was lifted by $5B, sizes of 4-week auctions are up from $55B, 6-week auctions have gone from $50B to $85B, while 8-week are up from $45B.
• Bill upsizing is likely coming to an end shortly - Jul 30's Treasury refunding policy statement noted "Treasury anticipates further marginal increases in short-dated Treasury bill auction sizes in the coming days and then maintaining sizes at or near those levels through the end of September."
• Including today's settlements through to mid-month, Treasury is set to raise a net $206B in new cash. Between mid-July and mid-August Treasury will have raised over $810B in new cash between bills and coupons; the last net cash paydown was in the first half of July (corresponding to the raising of the debt limit in early July).
• At just shy of $500B, the TGA is targeted to rise to $850B by end-September.
• We continue to note that reserves could pull back meaningfully by mid-September's tax date on the cash rebuild. The latest quarterly refunding saw the Treasury's advisory committee note: "Some members highlighted the potential that a rapid increase in bill issuance in conjunction with lower levels for RRP and uncertainty around levels of ample reserves could create funding stress as we head into the Treasury’s 2025 fiscal year end."

• US TSY TO SELL $65.000 BLN 17W BILL AUG 06, SETTLE AUG 12

• US TSY TO SELL $85.000 BLN 8W BILL AUG 07, SETTLE AUG 12