U.S. Treasury debt buyback plan lifts long-term bond yields

U.S. Treasury yields edged higher on Thursday morning following a sharp pullback the day before, as the Treasury Department announced an expansion of its debt-repurchase program. The 30-year Treasury yield rose three basis points to 5.2256%, while the benchmark 10-year yield increased one basis point to 4.6723%. The two-year note, which tracks short-term Federal Reserve policy, remained near 4.1727%.

The Treasury, led by Scott Bessent, said it would double the size of its buybacks, focusing on the long end of the yield curve. The announcement had initially pushed the 30-year yield down more than 10 basis points and the 10-year yield down over six basis points, reversing earlier weekly gains. Yields have been climbing steeply since June, reaching levels not seen since before the 2008 financial crisis.

The move comes as total U.S. government debt surpassed $40 trillion, roughly twice the amount a decade ago. Traders also weighed the Federal Open Market Committee minutes released on Wednesday, noting that recent data show modest price increases but inflation remains above the Fed’s 2% target.