AUGUST 3, 2011, 4:21 P.M. ET.

Treasury to Issue $72 Billion in New Debt Next Week

By JEFFREY SPARSHOTT And JEFF BATER

WASHINGTON—The Treasury Department, in its quarterly refunding announcement, said it would issue $72 billion in new debt next week—though future auctions may decrease slightly as the budget-deficit estimates are trimmed.

The announcement followed by a day Congress's approval of a package to raise the federal debt limit and cut government spending. The Treasury had warned for months that the government would exhaust its borrowing authority after Tuesday if the cap wasn't increased.

A senior U.S. Treasury official said a potential U.S. credit-rating downgrade isn't affecting the department's debt-management plans.

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"It doesn't affect our thinking at all," Mary Miller, Treasury's assistant secretary for financial markets, said at a news conference. She said the Treasury still plans to gradually extend the maturity of its securities portfolio.

The regular quarterly auction announcement held steady the amount of long-term debt issued by the Treasury at the last refunding.

Details of the offerings:

• The Treasury said it will sell $32 billion in three-year notes on Aug. 9. The Cusip number is 912828RB8. The notes mature Aug. 15, 2014.

• The Treasury will sell $24 billion in 10-year notes on Aug. 10. The Cusip number is 912828RC6. The notes mature Aug. 15, 2021.

• The Treasury will sell $16 billion in 30-year bonds on Aug. 11. The Cusip number is 912810QS0. The bonds mature Aug. 15, 2041.

All of the auctions will settle on Aug. 15.

The Treasury has been gradually lengthening the average maturity of the securities it issues—to almost 62 months in July from about 49 months in late 2008, after the government flooded the market with shorter-term Treasury bills during the financial crisis.

"Irrespective of anything or any discussion about ratings agencies our intention is to continue on that path," Ms. Miller said.

During the current quarter, the Treasury will meet the balance of its financing requirements with regular weekly bill auctions, monthly security auctions, and Treasury inflation-protected securities, or TIPS, auctions. The Treasury said it expects to modestly decrease nominal coupon issuance in coming months.

It also said it expects to provide more guidance in November about TIPS issuance in 2012.

Next week's auctions of long-term debt will refund $24.4 billion of maturing securities and raise $47.6 billion of new cash, the Treasury said.

On Monday, the Treasury estimated it expects to borrow $331 billion this quarter. For the next quarter, October through December, the Treasury expects to borrow $285 billion.

The agency wouldn't have been able to issue new debt if Congress hadn't agreed to raise the debt ceiling.


Write to Jeffrey Sparshott at jeffrey.sparshott@dowjones.com and Jeff Bater at jeff.bater@dowjones.com

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