Treasury's $5 Billion Bond Buy Sits Uncomfortably Amid Rising Real Yields

The U.S. Treasury's expanded bond-buyback program has kicked off with a $5.187 billion purchase of long-dated government bonds on September 10, aiming to improve liquidity in older securities.

The operation targeted off-the-run liquidity by accepting 23 out of 40 eligible issues maturing between February 2037 and August 2046, with a maximum offer ceiling of $6 billion. The Treasury's nominal yield curve showed the 10-year yield rising 12 basis points from 4.83% to 4.95%, while its real yield curve climbed 9 basis points from 2.46% to 2.55%. Higher real yields can make non-yielding assets like Bitcoin less attractive.

In line with this, U.S. spot Bitcoin ETFs recorded a net outflow of $282 million on September 10, according to Farside Investors, while the crypto's price remained near a closely watched support area of around $76,000. The combination of higher real yields and weak regulated-fund demand suggests pressure on Bitcoin.