🕒 Created

The US Treasury will offer $25 billion of 30-year debt at the highest borrowing rate since 2001.

The US Treasury will offer $25 billion of 30-year debt at its monthly auction on Thursday. If prices remain at current levels, the auction will feature the highest borrowing cost since 2001. This high yield is a result of years of elevated inflation and government spending, which has forced the Federal Reserve to keep interest rates elevated. President Trump and Treasury Secretary Scott Bessent face a challenge as high financing costs feed into the broader economy. To address the pressure on long bonds, the administration announced a tweak to its debt-sales guidance, opening the potential for reduced long-bond supply. However, analysts suggest that the only clear solution to bring down long-term borrowing costs is for the US government to tighten its budget. While the administration may shift issuance toward shorter-maturity notes to sidestep higher yields, this strategy may increase refinancing risks.

Sources