The macro market faces an urgent issue, which can be considered a significant negative factor.
The U.S. Department of the Treasury announced its latest borrowing plan, needing to borrow over $1 trillion in the third quarter,
and hopes to have a balance of $850 billion in its Treasury General Account (TGA) by the end of September.
The way to achieve this is through a massive issuance of short-term Treasury bills (T-bills).
To alleviate market pressure, the Treasury will also increase repurchase operations (buying back some old bonds), but this is merely to maintain the structural scheduling of market operations and not to rescue the market.
Meanwhile, the balance of the Federal Reserve's overnight reverse repurchase agreement (RRP) tool is nearing zero.
In simpler terms, an important cash reservoir in the U.S. financial market is about to be exhausted, while the government simultaneously needs to withdraw large amounts of cash from the market. The combination of these two factors may trigger a funding squeeze in September, potentially impacting the cryptocurrency market.
Perhaps similar to 2024, the real market activity will start in October.
