The US Treasury announced on August 19 that it would double its liquidity-support buybacks of longer-dated securities from $2 billion to at least $4 billion per operation, effective September 9 through November 4. This decision comes as the US national debt has just crossed the $40 trillion threshold and 30-year Treasury yields reached approximately 5.33%, their highest level since 2007. Annual net interest payments on federal debt are projected to exceed $1 trillion, surpassing the US defense budget of approximately $886 billion for fiscal year 2024. The federal budget deficit stands at roughly $2 trillion per year, or 6.4% of GDP, fueling a growing supply of Treasuries and maintaining upward pressure on yields.
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