Treasury announces upscaled buyback operation for longer-term debt, sending yields lower
The move aims to restore liquidity in the 10-year to 30-year market as long-term yields hit their highest levels in years, Treasury said.
- On Wednesday, The Treasury Department announced plans to more than double its buyback operations, raising the maximum size from $2 billion to at least $4 billion for 10- to 20-year and 20- to 30-year sectors.
- Treasury targeted these long-dated nominal sectors following a buyers' strike that began in late June, which combined with inflation concerns and expanding government debt to push yields to nearly 20-year highs on Tuesday.
- Markets reacted sharply to the announcement, with the benchmark 10-year note yield falling 6 basis points to 4.647% and the 30-year bond tumbling 9 basis points to 5.196%.
- This intervention comes as the national debt climbed to $39.9 trillion, with annual interest payments projected to exceed $1 trillion this year, consuming about 19% of federal revenue according to the Peter G. Peterson Foundation.
- Projections from the Bipartisan Policy Center indicate the government could reach the $41.1 trillion statutory limit by 2027, prompting Senate Majority Leader John Thune to warn of an "ever looming Debt Ceiling disaster.
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Bond market takes a breather after surprise move by Treasury Department
By John Towfighi, CNN New York (CNN) — The Treasury Department made a surprise move Wednesday after bond yields hit their highest levels in almost two decades, doubling its planned purchases of longer-term bonds and easing pressure on the market. Bonds rallied, driving yields lower, after the announcement, providing some relief after a sell-off earlier The post Bond market takes a breather after surprise move by Treasury Department appeared firs…
The New York stock market opened higher as Treasury yields plummeted following the U.S. Treasury Department's expansion of its medium- and long-term bond buybacks. Investor sentiment appears to have improved somewhat as medium- and long-term bond yields, which had been on an upward trend due to recent concerns over fiscal deficits and inflation, responded to the Treasury Department's market stabilization measures. As of 9:37 a.m. on the 19th (lo…
The yield of 30-year US government bonds at times reached the highest level in 20 years. The Treasury now wants to double the buybacks, which makes it easier.
The US Treasury Department announced it will increase the limit on long-term bond repurchase operations to at least $4 billion to support market liquidity. Following this liquidity measure, gold prices, facing inflationary and interest rate pressures, rose rapidly.
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