The U.S. Treasury Department has sharply increased its borrowing estimate for the current quarter, projecting $514 billion in net marketable debt from April through June. That marks a stunning 317% jump from its earlier forecast of $123 billion, made just two months ago.
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What Changed?
The big shift is largely due to the government starting the quarter with far less cash on hand than expected. Bloomberg reported in February that the Treasury expected to have $850 billion in its coffers by the end of March. Instead, the balance was just $406 billion.
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“Excluding the lower than assumed beginning-of-quarter cash balance, the current quarter borrowing estimate is $53 billion lower than announced in February,” Treasury said on Monday.
Bloomberg reported that lower balance is mostly the result of Congress still not raising the federal debt ceiling, which limits the government's ability to issue new debt. The Treasury is still assuming that the debt limit will be resolved and says it expects to have $850 billion in cash by the end of June. But if that doesn’t happen, borrowing would likely come in $53 billion lower than planned.
Looking Ahead
For the July through September quarter, the Treasury expects to borrow $554 billion, again assuming the cash balance reaches $850 billion by the end of the period.
The department also revised its look back at the first quarter of 2025. It had expected to borrow $815 billion but ended up needing just $369 billion, mainly due to ending that quarter with $444 billion less in cash than assumed.
According to Bloomberg, Wall Street had been bracing for a sharp increase in borrowing needs. JPMorgan Chase JPM had forecast $255 billion in borrowing for the current quarter, based on a much lower cash balance projection. Meanwhile, Bloomberg also cites Lou Crandall, senior economist at Wrightson ICAP, who warned even before the announcement that the Treasury might raise its estimate if it continued assuming an “unrealistic” $850 billion end-of-quarter balance.
Crandall also said that President Donald Trump's recent hikes in import duties could be influencing Treasury's cash planning, as higher customs revenues flow in.
Public Reaction
The news of the Treasury's updated borrowing plan has stirred up a wave of reactions online. Some pointed out the irony of increased debt under a political movement that once promised fiscal discipline. Others questioned how the government could miscalculate its cash position so drastically in just a few months.
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Concerns also surfaced about how the surge in borrowing might affect everyday Americans, with several users warning that higher debt could result in rising mortgage rates, credit card interest, and other borrowing costs.
There was also criticism of proposed tax cuts and military budget increases, with some highlighting the Pentagon's repeated failures to pass audits. A few questioned why the government needs to borrow its own currency in the first place, while others expressed frustration over what they see as a lack of accountability and fiscal responsibility.
Overall, the responses reflect widespread unease about the economic implications of the Treasury's revised estimates and what they signal about the state of federal finances.
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