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Treasury more than doubles money in government checking account

WASHINGTON – The federal government, concerned about possible financial market disruptions from events such as cyberattacks, has decided to more than double the amount of money it keeps in its checking account.

The Treasury Department announced Wednesday that it will aim to run an operating balance of between $200 billion to $225 billion, which would be enough to pay the government’s bills for about a week.

Since the 2008 financial crisis, the Treasury has held a daily balance of around $80 billion.

Treasury officials said they believed it would be prudent to keep more money on hand in the event Treasury was blocked from raising funds in the bond market by events like Superstorm Sandy, the terrorist attacks of 2001 or a future cyberattack.

While the balance will fluctuate, the plan is to keep a minimum balance each day of roughly $150 billion.

Treasury also announced Wednesday that it planned to gradually increase the amount of its debt held in short-term Treasury bills, which now account just 11 per cent of total Treasury debt. The increase is in response to growing demand by institutional investors for short-term debt.