Core Viewpoint - The U.S. Treasury's plan to issue more Treasury bills to cover the deficit may pressure the Federal Reserve to purchase more short-term government bonds [1] Group 1: Treasury Issuance - The U.S. Treasury is increasing the issuance of Treasury bills to address the budget deficit [1] - This increase in Treasury bill issuance could lead to a misalignment in the Federal Reserve's bond portfolio structure [1] Group 2: Federal Reserve's Bond Portfolio - The Federal Reserve currently holds a $4.2 trillion portfolio of U.S. Treasury securities, with only $195 billion in Treasury bills, representing about 5% of its total holdings [1] - The Federal Reserve aims to align its investment portfolio structure with the market's circulating U.S. Treasury structure [1]