US Rates Watch: Nov refunding recap: steady sizes

Treasury maintained coupon auction sizes for the Nov refunding quarter. Treasury adjusted forward guidance to “Treasury anticipates maintaining nominal coupon and FRN auction sizes for the next several quarters” from “…for at least the next several quarters,” which we interpret to mean no auction size changes for the next 3-5 quarters or at least the Aug ’27 refunding. In contrast, TBAC minutes suggested Treasury increase coupon auction sizes in the second half of FY’27; Treasury ignored TBAC’s recommendation, suggesting UST is not willing to commit to higher coupon issuance any time soon. We believe debt limit dynamics are likely to delay the timing of coupon auction size increases until resolved, with UST financing need forecasts implying a DL X-date as early as Aug ’27. We therefore revise the timing of coupon size increases from Aug ’27 to Nov ’27, with growth across 2y-10y auctions but most of the increase concentrated in 2y-5y tenors. Long-end buyback max sizes are maintained at