Bessent's Bond Buyback Bites Dust as Interest Rates Soar

Despite efforts by Treasury Secretary Scott Bessent to calm the bond market, interest rates continue to rise. The yield on the 10-year Treasury note rose back to 4.69% Thursday, nearly matching its level early Wednesday before Bessent's announcement that the Treasury would double its bond buyback program to $4 billion per operation.

Bessent said the bond repurchase program could be larger than $4 billion and argued that yields don't reflect underlying fundamentals. However, analysts say reducing the deficit is mostly up to Congress, rather than the Treasury Department.

The rise in interest rates has put pressure on Fed Chairman Kevin Warsh to clarify his approach to containing inflation when he delivers a high-profile speech next Friday at an annual Fed conference in Jackson Hole, Wyoming.