The United States Department of the Treasury will at least double the maximum size of its liquidity support buybacks for longer-dated nominal coupon securities, raising the cap to $4 billion per operation from $2 billion, after yields on long-dated government debt surged to multi-year highs.
The expansion, covering the 10-to-20-year and 20-to-30-year sectors, takes effect September 9 and runs through November 4. In Wednesday's market, the 10-year note yield fell 6 basis points to 4.647% and the 30-year bond yield dropped 9 basis points to 5.196%, pulling back after the 30-year rate briefly traded near 5.327% on Tuesday, its highest since June 2007.
Pressure on sovereign borrowing costs has extended beyond the United States. Germany's benchmark 30-year bund yield touched 3.763%, a 15-year high, while Japan's 30-year bond yield climbed to 4.1285%, surpassing its spring peak.