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A man walks away from the U.S Treasury Department in Washington, U.S., August 6, 2018. Photo by: Brian Snyder/Reuters

U.S. Treasury projects it will borrow $433 billion this quarter

WASHINGTON (AP) — The Treasury Department said Monday it expects to borrow $433 billion in the current July-September quarter. That would be the largest quarterly borrowing total since early 2018, as the government replenishes its cash reserves following the expected resolution over raising the debt limit.

Treasury said the $433 billion in borrowing it expects this quarter, through selling Treasury bonds and bills to the public, would be the largest quarterly total since it borrowed $488 billion in the January-March quarter of 2018.

Market borrowing for this budget year is projected to total $1.27 trillion, a 6.5% increase from the $1.195 trillion borrowed in the 2018 budget year.

The rising borrowing needs reflect that the government’s deficit is increasing. In its February budget submission, the Trump administration projected the deficit will top $1 trillion this year.

The Democratic-controlled House last week approved a bipartisan debt and budget deal that the Senate is expected to pass this week. That measure suspends the current $22 trillion debt ceiling for two years until July 31, 2021.

WATCH: Is new federal budget deal a short-term fix for a long-term problem?

That will allow the government to borrow as much as it needs to pay its bills until the new deadline without facing the threat of a potentially devastating default on the nation’s debt.

Treasury had initially estimated it would need to borrow $160 billion this July-September quarter but that was before House Democrats struck a budget and debt deal last week with the Trump administration, ahead of a fall deadline for action.

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