Treasury’s big move to buy back $4 billion in long-term bonds each time—doubling from $2 billion—aims to cool soaring interest rates and stabilize markets, as geopolitical tensions, AI investments, and ballooning deficits push borrowing costs higher. This isn’t just about bonds: it’s part of a broader strategy by Treasury Secretary Scott Bessent to calm yields, even teaming up with Japan to prop up the yen, while also hinting at cutting long-term debt issuance to manage supply and demand. The goal? Keep mortgage and car loan rates from climbing further—and keep the whole financial system steady.
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