Bessent’s Buyback Remarks Fail to Stop Treasury Yield Surge as 30-Year Hits 5.25%

"We have a lot of policy tools … Anything that happens within 24 hours is just noise"

U.S. Treasury yields climbed again even after Treasury Secretary Scott Bessent said Treasury buybacks could exceed $4 billion per operation.

On August 20, the yield on the 30-year U.S. Treasury rose more than 5 basis points in intraday trading to 5.25%, according to Bloomberg and other media outlets. The move came after the yield, which had earlier reached its highest level in about 19 years, fell more than 10 basis points the previous day.

The benchmark 10-year Treasury yield also climbed more than 5 basis points at one point on August 20 to 4.708%, topping the level seen before the Treasury announced a buyback expansion earlier on August 19.

Bessent sought to tamp down the rise in yields, saying the government has ample policy tools available.

“We have a lot of policy tools, so we’ll watch this,” Bessent told CNBC on August 20. “Part of that is sending a signal here and showing that Treasury yields are not properly reflecting the underlying economic conditions right now.”

The Treasury said on August 19 that it would more than double the cap on long-term Treasury buybacks to at least $4 billion per operation from $2 billion. The measure covers Treasuries with remaining maturities of 10 to 20 years and 20 to 30 years, and the higher cap will apply from Sept. 9 through Nov. 4.

The 30-year Treasury yield dropped sharply after the announcement, but retraced most of that decline on August 20.

Bessent dismissed the rebound in yields as insignificant. “Everything that happens within 24 hours is just noise.”

Noh Jeong-dong, Hankyung.com reporter dong2@hankyung.com