Treasuries have outperformed comparable swaps since the Treasury secretary announced plans to at least double long-term bond buybacks.
Treasury Secretary Scott Bessent’s plan to expand US bond buybacks is already affecting markets, Bloomberg reported.
Treasuries have outperformed swaps with similar maturities since the announcement, narrowing the 30-year spread to its smallest level since February. Benchmark US yields also moved lower after initially fluctuating.
The Treasury plans to at least double its buybacks of longer-dated bonds. Citi rates strategist Jason Williams said the policy could provide a backstop for investors holding long-term debt.
The market response comes as investors debate whether buybacks can meaningfully reduce borrowing costs. Bessent has also taken steps involving currency markets, adding to expectations that the Treasury will intervene more actively to achieve its goals.
