Privately‑held net marketable borrowing is Treasury’s estimate of the net amount of marketable Treasury securities it must place with private investors over a quarter. Practically, it is the net new supply sold into the private market after accounting for principal redemptions, projected cash‑balance changes and the effects of Federal Reserve SOMA holdings (it excludes SOMA “rollovers”/add‑ons but includes financing needed when SOMA securities redeem). Treasury shows the number in its “Sources and Uses” table: gross auction financing needed to cover redemptions and cash uses, less non‑marketable inflows and adjustments, equals privately‑held net marketable borrowing. (In short: planned gross issuance – scheduled redemptions ± SOMA and cash‑balance effects = privately‑held net marketable borrowing.)
SOMA is the System Open Market Account—the portfolio of Treasury and agency securities the Federal Reserve (operated by the New York Fed) holds for monetary policy. When the Fed buys securities into SOMA it removes those securities from the privately‑held market (reducing Treasury supply to private investors); when SOMA lets securities mature (redemptions) the Treasury may need to sell more securities to the private sector to replace that privately‑held supply. Thus changes in SOMA holdings affect the amount Treasury must borrow privately even if the Fed’s purchases/sales do not change gross Treasury issuance plans immediately.
Treasury’s “cash balance” refers to the balance in the Treasury General Account (TGA) at the Federal Reserve—Treasury’s operating account used to make government payments. Treasury sets a target (assumption) for the end‑of‑quarter cash balance used to size its quarterly financing plan; that forecast is developed by Treasury’s Office of Debt Management / Office of Fiscal Operations and Policy in coordination with the Bureau of the Fiscal Service and other agencies. The Fiscal Service operates the TGA; Treasury officials decide the target cash posture used in financing estimates and auctions.
The estimates set the scale and timing of Treasury auctions: higher projected privately‑held borrowing leads to larger auction sizes and/or more bill issuance, which increases net supply to private investors. Bigger supply expectations (absent offsetting demand) tend to put upward pressure on yields; conversely lower estimates reduce near‑term net supply. Market participants use Treasury’s projections together with Fed policy and cash‑balance assumptions to anticipate auction schedules, dealer needs and likely yield responses.
The Quarterly Refunding is Treasury’s twice‑a‑year review that announces the coming quarter’s nominal coupon issuance plan (notes, bonds, TIPS) and any changes to the auction schedule or sizes. On the Refundings’ announcement day (here Feb 4 at 8:30 a.m. ET) Treasury will publish the detailed plan—coupon sizes, reopenings, bill issuance guidance and the final auction calendar—that market participants use to price and position ahead of auctions.
The Office of Debt Management in Treasury’s Office of Financial Markets (Domestic Finance) produces the marketable borrowing estimates. The Office of Fiscal Operations and Policy (and the Bureau of the Fiscal Service) provide cash forecasts and daily cash‑flow estimates. Treasury combines those inputs (receipts/outlays, scheduled redemptions, SOMA effects and target TGA assumptions) in its internal sources‑and‑uses models to produce the quarterly privately‑held net marketable borrowing figures and auction plans.