The focus on Wednesday may shift from the Federal Reserve’s policy meeting to the Treasury Department’s upcoming borrowing plan. According to Bloomberg, the Treasury Department’s quarterly refunding announcement is expected to outline its strategy to increase sales of long-term debt. This comes as long-term bond prices have been falling for weeks, despite the Federal Reserve suggesting that it may stop raising interest rates. The decline in bond prices has caused yields to rise to levels not seen since the global financial crisis, making it more expensive for the government to issue long-term Treasury bonds. This has led to a decline in the iShares 20+ Year Treasury Bond ETF. Market participants will be closely watching to see if the Treasury’s plan will continue the pace of expansion in longer-term debt sales set in the August plan. While Treasury Secretary Janet Yellen denies that the rise in yields is directly linked to the increase in federal debt, Fed Chair Jerome Powell has acknowledged the deficits as a potential factor. Investors are placing significant importance on Treasury bond supply as they predict that the Federal Reserve will not change interest rates on Wednesday. The upcoming refunding event may hold more importance in the eyes of the market compared to the Federal Open Market Committee meeting. Bond traders are predicting a refunding size of $114 billion, similar to the trend set in the August plan. However, there is an alternative perspective suggesting that the growth in long-term debt may be more modest due to rising yields, leading to a greater reliance on short-term bills. The JPMorgan Chase rates team anticipates a scenario similar to what occurred in August, with estimated net borrowing of $852 billion from October through December.