Original title: Goldman Sees Reserves Sub-$3 Trillion Despite Funding Relief
A torrent of US Treasury bill issuance in August is likely to ease this month, relieving pressures on funding markets, but won’t be enough to prevent a gradual slide in bank reserves below $3 trillion by the end of the quarter, according to Goldman Sachs & Co. The Treasury has moved aggressively to refill its coffers — known as the Treasury General Account or TGA — since Congress lifted the debt ceiling two months ago. In August, the department’s net new supply of bills totaled more than $373 billion, TreasuryDirect data show. While that was a considerable total for fixed-income investors to digest, it also means that the weeks ahead may require less issuance as a result — in turn lightening the load on front-end markets.