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Facing rising deficits, Treasury will lean on ‘tried and true’ securities, for now

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Treasury will use reliable debt instruments in this period of heavy financing needs and stay away from show pony offerings like a 50-year bond.

Facing rising budget deficits and borrowing needs, the Treasury Department is going to rely on reliable debt instruments rather than offer any new exotic securities to raise the needed funds, analysts said.

There are “no obvious candidates for additional instruments, so [the government will] lean heavily on the tried and true securities to get through this period of heavy financing needs,” said Stephen Stanley, chief economist at Amherst Pierpont Securities, in an email response to a question.

Asked at a press briefing if Treasury was thinking any more about offering a 50-year bonds, Brian Smith, deputy assistant secretary for federal finance, said the idea had been put to rest.

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