The US Treasury announced it will at least double the size of its long-term bond buyback program, causing long-term US government bond yields to fall significantly. The market views the Treasury as stepping in directly to add liquidity and support demand in the bond market. Buying returned to the market quickly after earlier concerns about high bond issuance volumes, rising government debt, and higher long-term borrowing costs. The expanded buyback program helped ease worries about selling pressure in the market, including pressure from the term premium, sending 10-year and 30-year US Treasury yields down sharply from their previous highs. At the same time, the US dollar index and US Treasury yields declined, while gold prices rose about 3% and S&P 500 futures gained about 0.4%, reflecting the market's positive response to lower bond yields and improving liquidity in the bond market.
Treasury doubles bond buyback, causing long-term yields to fall significantly.
Expanded buyback program sends 30-year yields down sharply.
