It’s official: US Treasury to launch a 2-month T-bill

Invesco Fixed Income does not anticipate significant market disruption due to the new T-bill offering

Time to read: 2 min

A new 2-month Treasury bill (T-bill) will launch in October, according to details announced by the Treasury on Aug. 1. The new T-bill will share a schedule with the 1-month T-bill, which is currently auctioned on Tuesday and settled on Thursday of the same week. Then on Dec. 6, both bills will transition to a Thursday auction and settlement the following Tuesday. Invesco Fixed Income believes that this transition period should allow investors to become familiar with the new bill and help minimize the possibility of disruption at the short end of the Treasury bill yield curve.

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Get ready for the 2-month T-bill

Treasury appears ready to introduce this new maturity later this year

Time to read: 3 min

After three years of discussion, the US Treasury appears ready to introduce a new 2-month Treasury bill (T-bill) into its auction schedule. Invesco Fixed Income believes a 2-month T-bill auction would be a positive addition to the Treasury’s current lineup and would be unlikely to create market disruption.

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US Treasuries contend with debt ceiling déjà vu

Extraordinary funding measures are running out, and concerns are evident in Treasury yields

Time to read: 2 min

The so-called “extraordinary measures” that are currently being used to fund the US government are projected to run out in early March. With this “drop-dead” date quickly approaching, it appears that the Treasury bill market is already reacting to the potential disruption. Below I answer some frequently asked questions about the debt ceiling, extraordinary measures and the impact on Treasury markets.

When is the government likely to run out of funds?

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Debt ceiling saga faces important deadline

Without a deal by Dec. 8, ‘extraordinary measures’ will begin, with potential impacts for the US Treasury market

Time to read: 2 min

Tomorrow, Dec. 8, is an important date on the legislative calendar. As discussed in my last blog, the three-month suspension of the debt ceiling is set to expire on Dec. 8, after which the US Treasury will likely undertake “extraordinary measures” to fund itself. Invesco Fixed Income believes these legal stopgap measures would allow the government to meet its obligations over the next few months, and that is why we believe the Treasury market has, so far, reacted calmly to the upcoming deadline.

Dec. 8 is also the due date for another important legislative decision —

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Debt ceiling saga: Skipping ahead to the next chapter

We contemplate what happens next if the government can’t reach a deal before Dec. 8

Time to read: 3 min

The Treasury market received a reprieve in September when the White House and Congress agreed on legislation coupling hurricane relief funding with a suspension of the debt ceiling until Dec. 8.1 The agreement puts off a potentially contentious political debate and keeps the government funded until at least year-end. However, markets have now turned their focus to December and beyond. What should we expect to see in the Treasury market if a new debt ceiling deal can’t be reached by then?

September’s agreement calmed the markets — for now

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