U.S. 30-year and 10-year Treasury yields climb near multi-week highs despite Treasury’s $40 trillion bond buyback intervention.
U.S. Treasury yields extended gains for a second day, erasing nearly all relief from the department’s recent buyback announcement. The 30-year yield rose 2 basis points to 5.27%, approaching the 5.3% level that triggered market unease earlier this week, while the 10-year yield added 3 basis points to 4.73%.
The Treasury on Wednesday unveiled plans to at least double purchases of 10-, 20-, and 30-year bonds starting September 9, with operations running through November 4. Secretary Scott Bessent hinted at further expansion, but analysts remain doubtful, citing inflation concerns, shifting Fed messaging, and a surge in corporate debt issuance as stronger yield drivers.
Market reaction has been muted, with equities largely ignoring the move. Strategists warn the buyback may struggle to counter rising rate expectations or declining Fed credibility, complicating policy efforts to tighten financial conditions without additional rate hikes.