Treasury Department to buy back up to $6 billion in longer-term debt, triple the normal level
The move follows investor disappointment and aims to support liquidity as 10-year yields hit 4.85%, their highest level since 2023.
- On Wednesday, benchmark 10-year Treasury yields reached their highest levels since 2023 after the Treasury Department announced an enlarged buyback of up to $6 billion in longer-dated bonds, disappointing some investors.
- Treasury Secretary Scott Bessent announced the increased buybacks in August to stabilize markets, but the $6 billion figure fell short of investor expectations, causing bond prices to sink and yields to rise.
- The 10-year Treasury yield climbed to 4.84% on Wednesday; Tom di Galoma, managing director at Mischler Financial, said "bond prices sank and yields rose" due to buyback disappointment.
- Rising yields are increasing borrowing costs for consumers, with the average 30-year fixed mortgage rate reaching its highest level since July 2025 last week, while global borrowing costs in Europe and Asia also surged.
- With investors weighing rising fuel costs and sticky inflation, the Federal Reserve faces an upcoming interest rate decision next week, where traders price in about 60% odds of a rate hike.
124 Articles
124 Articles
Treasury Buyback Fails to Shock and Awe the Bond Market
“The Treasury Department failed to cow the bond market Wednesday with its amped-up buyback announcement, as rates still rose,” Axios reports. “The reaction suggests that Treasury Secretary Scott Bessent’s unusual showdown with the markets could itself add to upward pressure on interest rates — precisely the opposite of what most think he’s trying to achieve.”
US Treasury yields hit highest level since 2023 as buyback disappoints
U.S. 10-year Treasury yields touched their highest level since November 2023 before easing after strong auction demand. Rising oil prices and shifting Federal Reserve rate-hike expectations added to concerns over inflation and the interest-rate outlook.
By announcing $6 billion in long-term US debt redemption while investors were expecting more, Scott Bessent caused interest rates to rise at 10 years and 20 years.
Coverage Details
Bias Distribution
- 54% of the sources are Center
![[your]NEWS](/_next/image?url=https%3A%2F%2Fgroundnews.b-cdn.net%2Finterests%2Ffb6dc495f74049f513563c33352175eaa0ecd509.jpg%3Fwidth%3D60&w=128&q=75)
Factuality
To view factuality data please Upgrade to Premium
