The U.S. government's attempt to alleviate the short supply ofT-bills is about to get a little harder.

After years in the making, a post-crisis rule to prevent a run on the money-marketindustry will finally take effect this October. It will forcefunds that oversee about $600 billion to abandon a fixed $1-a-shareprice and float their net asset value (NAV). But because businessesand state governments treat the funds like bank accounts, theprospect of prices falling below a buck is causing a big shift into money-market funds that buy only governmentdebt.

To cope, the Treasury Department stepped up bill issuance andboosted supply by almost a quarter-trillion dollars after its shareof U.S. government debt fell to multi-decade lows last year. Thatstill might not be enough. Estimates suggest between now andmid-October, the influx may produce an extra $400 billion or morein demand for short-term government securities and put a squeeze ona sizable chunk of the $1.51 trillion bill market.

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