Bessent Eyes Near $1 Trillion Treasury General Account to Supercharge Bond Buybacks

Treasury Secretary Scott Bessent is considering tapping the Treasury General Account, which has been built up to approximately $950 billion, to fund an accelerated program of government bond purchases, according to two senior Treasury officials who spoke to CNBC. The move would give the Treasury significant firepower to push down long-term yields, which have been surging, with the 30-year bond recently trading around 5.235% and the 10-year near 4.704%. Treasury last week doubled the maximum size of its buyback operations from $2 billion to at least $4 billion, targeting off-the-run securities in the 10-to-20-year and 20-to-30-year range, but markets were skeptical about the program's impact because Treasury had not specified how purchases would be funded.

Bessent has described the operation as a 'Treasury Twist,' referencing a strategy of buying long-term bonds while offsetting with short-term bill issuance, and the senior officials did not rule out that approach either. Bessent also told CNBC the buyback could ultimately exceed the $4 billion per issue ceiling. The initial buyback announcement briefly sent yields sharply lower, though the rally faded amid doubts over available funding, and Bessent's latest comments produced a similar pattern, with yields briefly pulling back before rising again.