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Treasury lifts Q3 borrowing forecast to $739 billion

The update widens Q3 borrowing needs versus the May outlook to $87 billion after adjusting for the higher assumed ending cash cushion.

Wednesday, August 5, 2026 · Written up by our desk · Government Bonds

The U.S. Treasury increased its expected third-quarter borrowing to $739 billion, raising the estimate by $68 billion from what it projected in May. Reuters reports the change reflects lower projected cash flows, partially offset by a higher-than-assumed starting cash balance.

After stripping out the benefit of the larger starting cushion, the increase in borrowing needs amounts to $87 billion above the May estimate, according to the Treasury's quarterly refunding statement. The plan assumes a cash balance of $950 billion at the end of September.

For the fourth quarter, Treasury projected borrowing of $628 billion, based on a year-end cash balance of $850 billion. The department also said it borrowed $190 billion in the second quarter and ended June with a cash balance of $919 billion.

Treasury will outline its refunding plans, including auction sizes, on Wednesday. Reuters notes traders will look for signals on whether the department plans to issue more longer-dated debt, amid oil-driven inflation concerns linked to the Israel-Iran conflict and recent moves that pushed longer-dated Treasury yields to multi-year highs.

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