US selling $55 bn in bonds next week

WASHINGTON: The US government will sell USD 55 billion in bonds next week as part of a massive borrowing to pay for its financial rescue programs and foresees a robust appetite among investors for the securities amid continued economic uncertainty.

The Treasury Department said Wednesday it is bringing back its three-year notes, selling them monthly to help cover the increased borrowing needs, and will auction USD 25 billion of them on Monday. The government also will offer USD 20 billion in 10-year notes on November 12 and USD 10 billion in 29 3/4-year bonds on November 13.

The government plans to borrow a record USD 550 billion in the last three months of the year to help pay for the various financial rescue packages put into effect in response to the global crisis. Officials project that the government will need to borrow an additional USD 368 billion in the first quarter of 2009, putting a sea of red ink in front of the incoming president, Barack Obama.

"We believe that these changes will address our borrowing needs," Karthik Ramanathan, Treasury acting assistant secretary for financial markets, said at a news conference. "These are highly uncertain times."

He dismissed concerns that such a huge volume of government securities being sold in blocks could outstrip demand by US and foreign investors amid a global financial crisis.