A new Securities Industry and Financial Markets Association (SIFMA) survey projects net treasury issuance to continue to rise in the third quarter of 2009, from second-quarter levels, but it’s not projected to hit a level as high as the $527 billion seen in the third quarter of 2008, during some of the worst months of the economic crisis.
SIFMA’s “Quarterly Government Securities Issuance and Rates Forecast,” a survey of trading strategists and research analysts in SIFMA’s Government Securities Research, Analysis and Strategy Committee, forecasts net Treasury issuance to be $446 billion in the third quarter—higher than the $343 billion that the Treasury issued in bills, notes and bonds for the second quarter of 2009.
Participants indicated that benchmark Treasury yields would be slightly higher at year end; the median forecast calls for a 10-year Treasury yield of 3.70% at the end of the third quarter and 3.90% at year end. They project a 4.50% yield on the 30-year Treasury at the third quarter-end rising to 4.63% at year end. Survey participants expect the 2-year Treasury to yield 1.05% at the end of the third quarter and 1.23% at year end.
Michael K. Stanley can be reached at mstanley@sbmedia.com