TREASURY FINANCING REQUIREMENTS

$ Billions
(Projected)
Deficit Funding (Def + / Surplus -) fi Means of Financing Change in Cash Balance Net Non-Marketable Financing Net Marketable Financing Other* Net Marketable Financing Bills Nominal Notes TIPS Bonds
Notes: Starting Cash Balance Ending Cash Balance 21 45 21 45 45 35

April - June 2004

(Actuals)
26

July - September 2004
(Projected)
91

22

-24 6 38 2 38

-23 4 31 14 31 -38 69 9 -8

10 -4 89 -4 89

* Includes direct loan activity, changes in accrued interest and checks outstanding and minor miscellaneous transactions. Note: Totals may not add due to rounding T
Department of the Treasury Office of Debt Management Office of Fiscal Projection

August 2, 2004-1

$Bil.

TREASURY DAILY OPERATING CASH BALANCE
FY 2003 FY 2004

$Bil.

50

50

40

40

30

30

20

20

10

10

0

Oct

Nov

Dec

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

0

Department of the Treasury Office of Debt Management

Source: Daily Treasury Statement, data through July 28, 2004.
August 2, 2004-2

Months 90 80 70 60 50 Average Maturity 40 30

DEBT MATURITY MEASURES
Average Maturity of Issuance

1

Months 90 80 70 60 50 40 30.9 30 20

55.1

As of June 30, 2004 Assumptions: FY05 MSR Budget and coupon issuance maintained at current level.

20 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008
1

The average maturity of issuance is the ultimate average maturity achieved if coupon issuance in any given quarter is held constant going forward and the balance of financing needs are met with changes in bill issuance. (4 quarter moving average)
August 2, 2004-3

Department of the Treasury Office of Debt Management

Treasury Marketable Coupon Securities $Bil. 1000 Actual Projected 4th Quarter 3rd Quarter 2nd Quarter 800 1st Quarter

MATURITY PROFILE

1

$Bil. 1000

800

600

600

400

400

200

200

0

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

0

Department of the Treasury Office of Debt Management

Note: Where applicable, maturities represent first call date. 1 Issued or announced through July 30, 2004. Assumes coupon pattern and issuance amount maintained at current levels.

Calendar Year

August 2, 2004-4

FINANCING RESIDUALS GIVEN CURRENT ISSUANCE CALENDAR
Assumes current coupon issuance pattern and issuance amount — Bill issuance at levels required to maintain outstanding FY$ amounts nearly equal to June 30, 2004 total outstanding

$Bil. 600 500 400 300 200 100 0 -100 -200 -300
Deficits minus potential error in OMB estimate

$Bil. 600 500 400 300 200 100 0 -100

Deficits plus potential error in OMB estimate

FY05 OMB MSR Budget deficit forecast

Bars indicate estimated additional financing required in given year for different deficit outcomes

-200 -300

2004

2005

2006

Note: Potential errors were estimated with a linear least-squares regression using OMB's Budget forecasts since 1989 and the MSR since 1998.
Department of the Treasury Office of Debt Management August 2, 2004-5

Fiscal Years

2007

2008

2009

Percent 2 0 -2 -4 -6 -8 Percent 80 60 40 20 0 1950

SURPLUS/DEFICIT AND DEBT TO GDP
Surplus/Deficit % of GDP

1

Percent 2 0 -2 -4 -6 -8 Percent

Debt to GDP (%)

80 60 40 20 0

1955

1960

1965

1970

1975

1980

1985

1990

1995

2000

2005

'09

1 FY 2004-09 estimates from OMB MSR Budget of the United States Government FY 2005.

Source: Budget Historical Tables 1.2 & 7.1.
Department of the Treasury Office of Debt Management August 2, 2004-6

DOMESTIC NONFINANCIAL CREDIT MARKET AND TREASURY DEBT
$Bil. 20,000 15,000 10,000 5,000 0 Percent Nonfinancial Credit Market Treasuries 15,000 10,000 5,000 0 Percent Other 30 $Bil. 20,000

Treasuries Muni's

Corporates Home Mortgages

Other Mortgages Consumer Credit

30

20

20

10

10

0 1960
Department of the Treasury Office of Debt Management

1965

1970

1975

1980

1985

1990

1995

2000

0
August 2, 2004-7

Source: U.S. Federal Reserve Board of Governors Flow of Funds.

Percent 70 65 60 55 50 45 40 35 30 25 1969

TREASURY BILLS AS A PERCENTAGE OF THE MONEY MARKET

1

Percent 70 65 60 55 50 45 40 35 30 25

1973
1

1977

1981

Department of the Treasury Office of Debt Management

Money market = Treasury bills, nonfinancial commercial paper, and financial open market paper. Source: U.S. Federal Reserve Board of Governors Flow of Funds statistical release Z.1.
August 2, 2004-8

1985 1989 Quarterly

1993

1997

2001

PRIMARY DEALER TRADING VOLUME
$Bil. 450 400 350 300 250 200 150 100 50 0 1995 1996 1997
1
Department of the Treasury Office of Debt Management

Outright Transactions, 3-Month Moving Average

$Bil. 450 400 350

Bills Notes/Bonds Agencies MBS Corp
1

300 250 200 150 100 50 1998 1999 2000 2001 2002 2003 2004 0

Data available beginning September 26, 2001 Source: Federal Reserve Bank of New York.
August 2, 2004-9

TREASURY QUARTERLY NET MARKET BORROWING
$Bil. 120 80 40 0 -40 -80 -120 -160 -200 I -192.1 II III IV I 2000
Department of the Treasury Office of Debt Management

Calendar Quarter

52.1 74.4 17.8 84.2 111.3 82.6 52.5 15.1 60.3 81.5

145.9 113.4 31.3

$Bil. 120 80 40 0

-20.1 -47.7-26.1 Coupon Coupons Buybacks Over 10 yrs 5 - 10 yrs 2 - under 5 yrs Bills

-40 -80 -120 -160 -200 II III 2001 IV I II III IV I II III IV I II 2004
August 2, 2004-10

-163.4

2002

2003

$Bil. 10

TREASURY QUARTERLY NET BORROWING FROM NONMARKETABLE ISSUES
State and Local Series Foreign Series 7.6 7.6 4.5 3.9

$Bil. 10

5

Savings Bonds

5 0.8 0.8 0

0 -1.7 -5 -8.0 -10 -10.1 -10.6 -5.0 -2.2 -1.4 -5.5 -8.4 -0.1 -0.7 -2.4

-5

-10

-15

I

II

III 2000

IV

I

II

III 2001

IV

I

II

III 2002

IV

I

II

III 2003

IV

I

II 2004

-15

Department of the Treasury Office of Debt Management Office of Fiscal Projection

August 2, 2004-11

PRIVATELY HELD TREASURY MARKETABLE DEBT 1
Percent Percent Distribution By Maturity Over 10 years 2-10 years 100 15 19 Coupons 1-2 years 1 year & under Bills Percent

100 14 80 33 31 34 60 17 16 14 18 18 1997 1998
1

80

60

40

14 15

40

20 19 0 1996 1999

20 23 2001 2002 2003 Jun '04 0

2000

Department of the Treasury Office of Debt Management

Privately held marketable debt excludes holdings of the Federal Reserve and non-interest-bearing matured debt.
August 2, 2004-12

Calendar Year End Data

Percent 50 45 40 35 30 25 20 15 10 5 0 1993
1 2 3
Department of the Treasury Office of Debt Management

FOREIGN HOLDINGS AS A PERCENT OF TOTAL PRIVATELY HELD PUBLIC DEBT 1

Percent 50% 50 45 40

Benchmark revision of June 2003 Benchmark revision of June 2002
2

2

35 28% 30 25 20 15

Benchmark revision of March 2000

2

Estimated Foreign Holdings Foreign and International Institutional Holdings at FRBNY

10
3

5 2002 2003 2004 0

1994

1995

1996

1997

1998 1999 Calendar Quarter

2000

2001

Privately held debt excludes holdings of the Federal Reserve. Series for estimated foreign holdings. Data through May 31, 2004. See http://www.treas.gov/tic/index.html. Source: Federal Reserve Bank of New York statistical release H4.1.
August 2, 2004-13

AUCTION RELEASE TIMES
3.0 Minutes from Closing to Release
Data

3.0

Target Release Range 2.5

Through July 30

2.5

Current Quarter 2.0
(May 3 - July 30)

2.0

1.5

1.5

1.0

1.0

0.5

0.5

0.0

Aug-03

Sep

Oct

Nov

Dec

Jan-04

Feb

Mar

Apr

May

Jun

Jul

0.0

Note: No current quarter target release range exceptions.
Department of the Treasury BPD - Office of Financing Office of Debt Management August 2, 2004-14