Treasury doubles long-dated debt buybacks to $4 billion per operation
MacroDigital Finance
The U.S. Treasury Department announced on Wednesday that it is doubling the size of its buyback operations for Treasury securities with maturities between 10 and 30 years, to $4 billion per operation. Treasury Secretary Scott Bessent said the move is meant to signal that yields do not reflect underlying fundamentals, and he indicated the buybacks could be expanded further. The announcement came as long-dated Treasury borrowing costs had been rising sharply amid competition for capital from AI data-center builders and worries about government deficits, with U.S. sovereign debt hitting a record $40 trillion on Wednesday. Federal Reserve Chairman Kevin Warsh has promised price stability but has resisted giving clues about his rate-path view, and market participants say the bar for the Fed to step in with market-stabilizing purchases is very high. Analysts including Gennadiy Goldberg of TD Securities and Michael Feroli of J.P. Morgan said they do not see an impact on the Fed's ability to control short-term interest rates.
