Williams says Treasury's TGA rebuild in early July drained system liquidity through rapid bill issuance.
“The Treasury began to rebuild its TGA balance in early July. This involved a rapid increase in net bill issuance and a commensurate drain of system liquidity.”
Williams says Treasury expects TGA balances could peak around $1.025 trillion by late April, drawing down reserves.
“Treasury recently estimated that TGA balances could peak around $1.025 trillion by late April, amid tax season inflows, likely resulting in a notable drawdown in reserves.”
Williams notes Treasury estimates TGA balances could peak around $1.025 trillion by late April, drawing down reserves.
“In fact, the U.S. Treasury recently estimated that TGA balances could peak around $1.025 trillion by late April, amid tax season inflows, likely resulting in a notable drawdown in reserves.”
Williams says the Treasury General Account could increase by half a trillion dollars in coming months.
“By way of example, we are currently in the midst of a debt ceiling episode, which—if past experience is a guide—could see the TGA fall further before rapidly increasing by half a trillion dollars or more over the course of a few months.”