Group 1 - Federal Reserve Chairman Jerome Powell hinted at a potential halt in the reduction of U.S. Treasury securities from the balance sheet in the coming months, without mentioning the Treasury's role in this process [1] - The Treasury has been increasing the supply of short-term Treasury bills (maturing in one year or less), indicating a need for the federal government to maintain higher Treasury General Account (TGA) balances, which have been targeted at $850 billion for most of the past year [1] - Analysts suggest that the TGA balance could reach at least $900 billion in the upcoming quarterly update on November 3 [1] Group 2 - Bank of America data indicates that the increase in the weekly auction size of short-term Treasury bills suggests a net supply of approximately $146 billion this month, exceeding expectations by $80 billion [2] - The increase in short-term Treasury bill supply necessitates a higher TGA balance to match cash flow, with the Treasury aiming to maintain the TGA balance at a level sufficient to cover one week of expenditures and maturing tradable debt [2] - Wrightson ICAP's senior economist Lou Crandall noted that the official quarterly target balance for the TGA has remained stable at $850 billion for most of the past year, with expectations for an increase to $900 billion in the new borrowing forecast to be released on November 3 [2]