Dollar Slumps as Treasury Doubles Down on Bond Buybacks

The US dollar took a hit as the Treasury announced plans to double buyback sizes for long-dated bonds, up to at least $4 billion per operation.

This move aims to support the long end of the bond market and prevent higher borrowing costs from backing up further in the economy.

However, this interventionist policy may not address the underlying fiscal trajectory driving pressure on borrowing costs, which remains a concern for investors.

The US public debt has surpassed $40 trillion for the first time, underscoring unease about the fiscal outlook.