Bessent becomes most interventionist Treasury chief in decades

With a slew of unexpected maneuvers this year, Scott Bessent has emerged as the most interventionist Treasury secretary in financial markets in decades — putting his credibility on the line in an effort to quell a potentially damaging rise in US borrowing costs.

Wednesday brought the latest surprise.

Just two weeks after releasing its schedule for buying back older Treasury securities, the Treasury Department announced it would “ at least double ” its planned purchases of outstanding 10-year to 30-year debt.

That came after the Treasury earlier this month opened the door to potential cuts in issuance of longer-dated debt.

On July 31, Bessent oversaw the first purchases of yen by US authorities in three decades, an action seen as reducing the need for Japan to sell down its Treasuries stockpile to fund its own yen buying.

And early this year, Bessent deployed so-called rate checks — calls by authorities to banks for quotes on the yen — surprising even a former Japanese official.

“He’s activist, absolutely,” said Mark Sobel, a former US Treasury official now at the research group OMFIF.

“It harkens back to his hedge-fund background.” As for the motive: “It seems clear to me that he and the administration are concerned about the rise in long-term yields,” Sobel said.

The Treasury didn’t immediately respond to a request for comment on Bessent’s market measures.

As stewards of the nation’s economic policy and its financial markets, Treasury secretaries have often been forced to intervene in moments of crisis.

That’s not the case now, given that the bond selloff has been orderly and building for months.

But his action after 10-year Treasury yields, his self-specified financial benchmark , rose above where they were before Trump returned to office, shows mounting worries in Washington.

The rise in yields, on a combination of concerns about inflation, Federal Reserve policymaking and outsize fiscal deficits, has kept mortgage rates elevated and poses a headwind to economic growth months before the November congressional election.

When it comes to debt issuance, the Treasury has long hewed to the principle of being “regular and predictable,” and not surprising investors.