Bessent Boosts Debt Buybacks After Climb in Treasury Yields

The US Treasury unexpectedly announced it’s ramping up buybacks of long-dated government debt, taking the action in the wake of yields on such securities hitting the highest levels in years.

Just two weeks after releasing its planned schedule for buybacks this quarter, the Treasury Department on Wednesday said it’s “increasing, by at least double, the size of liquidity support buyback operations” for securities dated from the 10-year to the 30-year sector. Yields on the longest bond dropped nearly 10 basis points to 5.185%, pulling back from their highest level since 2007.

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Treasury Secretary Scott Bessent invoked the buyback program last year as part of the department’s “big toolkit we can roll out” if needed to address dislocation in the Treasuries market. He’s also repeatedly said, since taking office, that his key financial-market benchmark is 10-year yields. Last November, he said, “my job is to be the nation’s top bond salesman. And Treasury yields are a strong barometer for measuring success in this endeavor.”

“This administration needs a win and maybe that comes in the form of artificially trying to keep long Treasury rates contained,” said Jack McIntyre, a portfolio manager at Brandywine Global Investment Management. “They have to try something. Sentiment around the long-end globally is about as bearish as I have seen in a very long time.”