According to Tomas, the Treasury’s "train” of TGA spending started in earnest on Wednesday, February 12: "From my understanding, the official debt ceiling-induced’ Treasury General Account (TGA) drawdown began on Wednesday February 12… This train is now in motion and will not stop until lawmakers come to a new debt ceiling agreement.” He projects that the first segment of this process will likely involve around $600 billion in injections between February 12 and April 11.
Tomas notes: "This may incentivize money market funds to park cash in the Fed’s Reverse Repo, potentially pushing this chart up… Reverse Repo usage increasing would be a liquidity drain, as money would be moving away from markets and into the Reverse Repo facility at the Fed.” Overall, the true scale of the TGA-based stimulus remains uncertain.
While the Federal Reserve continues its Quantitative Tightening (QT) program, the TGA’s latest cash injection—pegged at up to $842 billion—has sparked debate over whether we are witnessing a stealth version of quantitative easing, sometimes referred to as "Not QE, QE.” Fed’s "Not QE, QE” In a post shared on X, macro analyst Tomas (@TomasOnMarkets) offered a breakdown of how this dynamic is playing out: "Not QE, QE’ has officially started.
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