Bessent's Bond Repurchase Plan Backfires, Sending Yields and Stocks Tumbling
· World · NBC News
Treasury Secretary Scott Bessent's attempt to reduce bond yields by repurchasing $6 billion worth of long-term government bonds backfired on Wednesday. Instead of declining, the 10-year bond yield surged to 4.85%, its highest level since November 2023, while 20- and 30-year yields rose to 5.3%. The market reaction led to a 0.6% drop in the Nasdaq Composite and a 0.5% decline in the S&P 500. Bessent had described the bond market as experiencing a 'fever,' driven by inflation fears linked to the Iran war and trade policies. Investor Stanley Druckenmiller warned that such interventions could trap the Treasury Department in a cycle of defending bond prices.
Why it matters
The failed intervention highlights the limited power of Treasury actions to control market dynamics, complicating efforts to stabilize bond yields and stock prices amid rising inflation.
Read the original report — NBC News
Join us on Telegram
Breaking news the moment it lands. At 10,000 members we ship the Android app.