U.S. Treasury Expands Long-Term Treasury Buyback to $4 Billion

The U.S. Treasury has increased the size of its long-term Treasury buyback to a minimum of $4 billion per session, but long-term interest rates remain at high levels. This measure aims to support liquidity in the Treasury market and will take effect on September 9. The buyback size for 10-20 year and 20-30 year nominal Treasury bonds will increase from the previous $2 billion to $4 billion. However, the market perceives this as a signal of the combined pressures of U.S. fiscal burdens and long-term bond supply. As of August 29, the yield on the U.S. 10-year Treasury bond was 4.722%, and the yield on the 30-year bond was 5.208%, showing no significant decline following the buyback announcement. The total public debt of the U.S. has reached $40.47 trillion, and the Congressional Budget Office (CBO) projects that the fiscal deficit for the 2026 fiscal year will reach 5.8% of GDP. In the long-term bond market, the supply of Treasuries, fiscal deficits, and inflation risks are reflected in interest rates, and while the buyback may improve trading conditions, the effect on lowering rates may be limited if government borrowing demand remains high. Market evaluations of this measure are mixed, with some investors interpreting the buyback as a positive for liquidity in the cryptocurrency market.