Treasury sells $104 billion in debt to fund the federal budget deficit

The US Treasury declared a record $104 billion worth of bond auctions for next week, part of its tremendous efforts to finance a rescue of the world`s largest economy.

Besides, the sales are expected to exceed the last week`s record of $101 billion set in auction and consist of two-year, five-year and seven-year securities. That record was matched by another $101 billion week in May. 

Despite the fact that next week`s total was in line with expectations, worries about supply have weighted on the U.S. government bond market, which will see a huge $2 trillion worth of new debt issued this year. 

The government is likely to raise about $85 billion in net new cash given that there are about $19 billion worth of coupon securities maturing during the week. 

The Treasury's include $40 billion in 2-year notes on Tuesday, $37 billion 5-year notes on Wednesday and $27 billion in 7-year notes on June 25. 

The U.S. bond market has been under pressure for three months, with benchmark yields growing to an eight-month high of 4 percent last week, as investors worried about a budget deficit expected to reach a striking 13 percent of the economy this year.

The U.S. government posted a $189.65 billion budget deficit in May, a record for the month and the eighth straight monthly deficit, the Treasury Department said on June 10.