Scott Bessent announces Treasury bond buybacks to stabilize markets

U.S. Treasury Secretary Scott Bessent has announced a strategy to intervene in the government bond market through large-scale buybacks to stabilize yields. Following a period where 10-year and 30-year Treasury yields reached 20-year highs, the Treasury Department indicated it would act as a significant player in the market to ensure yields reflect economic fundamentals rather than market volatility.

Bessent clarified that the previously announced $4 billion cap per operation should be viewed as a floor rather than a strict limit, suggesting the scale of buybacks could increase. The intervention aims to address liquidity issues, particularly in the 30-year maturity segment, and to prevent investors from trading based on headlines during periods of low market volume.

In addition to market interventions, Bessent signaled upcoming announcements regarding fiscal consolidation. He noted that the administration is examining both revenue and spending sides of the budget under the direction of President Donald Trump.