The cost of the recently announced bail-out and funding programmes for the US financial system looms large over the US government bond market. But the timing is far from ideal because issuance is about to surge just at a time when the ranks of dealers has thinned and their capacity to buy new debt is impaired.

Dealers face the sale of $34bn two-year notes on Tuesday and $24bn five-year notes on Thursday, unchanged from last month’s record sizes. Then comes the US Treasury’s refunding announcement next Wednesday.