NEW YORK, July 10 (Reuters) - Citigroup analysts on Friday forecast the U.S. government will issue $1.44 trillion in new debt in fiscal 2010, compared with the previous estimate of $2 trillion expected in the current fiscal year.

The proceeds from the debt sale should match the projected budget gap currently seen by the Congressional Budget Office, the analysts said in a research report published on Friday.

The debt mix will likely lean toward longer-dated bonds away from Treasury bills with the biggest increase resulting in bigger auction sizes for coupon securities, they said.

"An over-reliance on issuance of short-dated debt leaves the Treasury exposed to potential rapid shifts in investor appetite and sentiment as well as less predictable funding costs," the Citigroup analysts wrote.

They forecast the monthly auction size of two-year notes could gradually grow to $50 billion. This compares with the $40 billion monthly two-year auctions the Treasury has been conducting since January.

The auction sizes of three-year and five-year debt could increase to $40 billion each, while the monthly offering of seven-year notes could climb to $28 billion, they added.

Finally, the auction sizes of benchmark 10-year notes and 30-year bonds could grow to $25 billion and $17 billion, respectively, for the initial sales with two smaller re-openings each quarter, the Citigroup analysts said.

This week, the Treasury sold $35 billion in new three-year notes, and reopened an older 10-year issue by $19 billion and an prior 30-year issue by $11 billion.

In June, the Treasury auctioned $37 billion in five-year notes and $27 billion in seven-year debt.