US Treasury Boosts Liquidity Support, Yields Fall on Long-Dated Bonds

The US Treasury Department has announced it will double the size of its liquidity support buyback operations for longer-dated bonds, causing yields on the benchmark 10-year and 30-year U.S. Treasury notes to fall.

This move is seen as a signal that Washington is willing to act if necessary to support the long end of the market. However, some analysts believe more permanent measures may be needed to address underlying issues.

Gennadiy Goldberg, head of US rates strategy at TD Securities, commented on the development, saying 'I don't want to call it a Band-Aid measure but it is the first of many possible actions that the Treasury could take to support the long end.'

Markets will be watching for signs in the Federal Reserve's minutes from its most recent policy meeting, which are expected to provide insight into whether some members of the policy-setting Federal Open Market Committee are open to a rate hike.