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EC SD | The Biden administration had been trying to reduce the cost of mortgages during this election cycle by having the Treasury finance their deficit with short term T bills instead of the normal approach of issuing T bonds. Less bonds issued, should make the price go higher and that reduces the yields. Well that did not work out for them, sorry...
Now this "political stunt" by Treasury has to be unwound. A pile of these T bills will be maturing over the next year, and will likely be reissued the normal way - in the form of T bonds. This is on top of the financing of further deficit spending next year, so this will cause a massive amount of new T bonds. More T bonds issued will make the price fall lower, and that increases yields. | |
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10 year treasurey
