U.S. Treasury Considering Using $1 Trillion General Account for Bond Buybacks
The U.S. Treasury is considering using its roughly $950 billion General Account to fund an expanded bond buyback program, according to reports citing two Treasury officials. The account serves as the federal government's primary operating account at the Federal Reserve and has grown significantly under Secretary Scott Bessent’s leadership. This potential move comes after the Treasury announced it would double its maximum per-operation purchases for longer-dated securities starting in September. The news initially caused a drop in U.S. Treasury yields, with both 10-year and 30-year notes seeing declines of four basis points each before partially rebounding. Market analysts remain skeptical about whether the buyback program is large enough to significantly impact supply and demand dynamics in the $32 trillion bond market. The announcement coincides with the Jackson Hole Symposium, where Federal Reserve Chair Kevin Warsh will deliver a keynote address amid ongoing concerns over inflation and rising federal debt levels.
Topics: bond buybacks federal debt management General Account Treasury