Treasury Secretary Scott Bessent doubled the size of the government’s bond buyback operations. The bond market said “thanks, but no thanks.”
The 10-year Treasury yield climbed to roughly 4.85% on September 9, its highest level since October 2023, just as the expanded purchase program was set to begin. The 30-year yield pushed into the 5.2% to 5.3% range.
What Bessent announced, and why it didn’t stick
On August 19, the Treasury revealed plans to at least double the operational size of its bond buyback program, scaling from $2 billion to at least $4 billion per operation. The expanded initiative targets longer-dated Treasuries and is scheduled to run from September 9 through November 4.
The initial market reaction was exactly what the Treasury wanted. The 30-year yield dropped nearly 10 basis points in the immediate aftermath.
