According to two senior Treasury officials, the US Treasury may use treasury general account funds close to 1 trillion US dollars to provide financial support for the recently announced expansion of the US bond repurchase plan. Using TGA accounts will give the Treasury a powerful tool to influence long-term bond yields. Last week, the Ministry of Finance announced that it would double the repurchase scale of long-term non-newly issued bonds from US$2 billion to at least US$4 billion. This move surprised the market. Treasury Secretary Scott? Bessent said that the actual scale of operation may even be higher than this new minimum threshold. However, the Ministry of Finance did not specify the source of the repurchase funds. Most market participants had previously predicted that the Ministry of Finance would raise funds by issuing short-term treasury notes. The senior Ministry of Finance officials mentioned above did not rule out this option.

According to two senior Treasury officials, the US Treasury may use treasury general account funds close to 1 trillion US dollars to provide financial support for the recently announced expansion of the US bond repurchase plan. Using TGA accounts will give the Treasury a powerful tool to influence long-term bond yields. Last week, the Ministry of Finance announced that it would double the repurchase scale of long-term non-newly issued bonds from US$2 billion to at least US$4 billion. This move surprised the market. Treasury Secretary Scott? Bessent said that the actual scale of operation may even be higher than this new minimum threshold. However, the Ministry of Finance did not specify the source of the repurchase funds. Most market participants had previously predicted that the Ministry of Finance would raise funds by issuing short-term treasury notes. The senior Ministry of Finance officials mentioned above did not rule out this option.