Trump administration is losing the affordability debate: Eurasia Group

• The U.S. Treasury's bond buybacks are small relative to the global market and unlikely to durably change market outcomes.
• Treasury Secretary Bessent has limited tools to influence yields, and failure to achieve market goals could risk his credibility and political standing.
• The Treasury's actions could create conflict with the Federal Reserve, potentially pressuring the Fed to align with Treasury's agenda, which is detrimental to the Fed's independence.

Robert Kahn of Eurasia Group discusses the U.S. Treasury's debt buyback plan, noting its limited market impact and the Treasury Secretary's constrained tools. He warns that unsuccessful interventions could undermine credibility and create tension with the Federal Reserve, potentially pressuring the Fed on interest rates.