The Treasury Will More Than Double Its Government Debt Repurchases. Yields Are Sharply Lower.

The Treasury Department will more than double the size of government debt repurchases, sending yields lower on Wednesday.

The Treasury will specifically target the 10-to20-year and 20-to-30 year portion of the market, which had practically not seen buyers since late June. The maximum size of repurchases will be of at least $4 billion, the department said.

CNBC noted that the benchmark 10-year note fell 6 basis points, while the 30-year one did so by 9 basis points.

"This increase in buyback operation sizes reflects Treasury's desire to provide greater liquidity support in longer-dated nominal sectors where there is consistent strong sponsorship from market participants, as evidenced by the significant volume of high-quality offers Treasury routinely receives in longer-dated buyback operations," the department said.

Yields had been climbing sharply over the past days, accelerating the size of the U.S. national debt.

The numbers have moved quickly. Just six months ago, the nonpartisan Congressional Budget Office projected federal borrowing would reach about $39.4 trillion by the end of the fiscal year. Treasury data released Monday showed the national debt had already climbed to $39.9 trillion.

The yield on the 30-year Treasury had surged Tuesday to its highest level in nearly two decades. They were being pushed higher by a combination of concerns over inflation, the war in Iran and expanding government debt around the world.

Before the announcement, annual interest payments on the national debt were projected to exceed $1 trillion this year, according to the CBO, putting them roughly on par with the size of the Pentagon's budget.

Interest expenses already consume about 19% of federal revenue, according to the Peter G. Peterson Foundation. That share is projected to rise to 26% by 2036 if current trends continue. The faster pace of borrowing is also bringing Washington closer to another politically explosive debt ceiling fight. Congress raised the legal borrowing limit to $41.1 trillion last year.

Preliminary projections from the Bipartisan Policy Center indicate the government could reach that limit between late winter and midsummer 2027, with the latest borrowing figures pushing expectations toward the earlier part of that range.

President Trump has already urged lawmakers to act. Late last month, he called on the Senate to address what he described as the "ever looming Debt Ceiling disaster" before lawmakers left Washington for the August recess. Senate Majority Leader John Thune acknowledged that Congress would eventually have to confront the issue. "$40 trillion in debt, seems to me that should get our attention," Thune said.