Treasury Just Drew a Line in the Sand at 5.3%, and Bitcoin Noticed
The US Treasury said Wednesday it will at least double the size of its long-end debt buybacks. The 30-year yield reversed sharply from a 19-year high, and Bitcoin climbed past $65,000.
The larger operations start September 9 and cover bonds maturing in 10 to 30 years. Treasury framed the move as liquidity support, but traders heard a message about borrowing costs.
Why Treasury Buybacks Doubled After a 19-Year Yield High
The 30-year Treasury yield touched 5.337% on Tuesday, its highest level since 2007. Heavy issuance and rising term premiums had kept long-dated bonds under sustained selling pressure for weeks.
Hours after the peak, the announcement lifted the cap on each buyback operation from $2 billion to at least $4 billion. The change applies to the 10 to 20-year and 20 to 30-year sectors and runs through November 4, when the next Quarterly Refunding is scheduled.
