Treasury Can Send Strong Signal to Market, Swiber Says

• Treasury's use of buybacks is a notable pivot, moving beyond just liquidity provision to controlling longer-term rates, but it creates fiscal policy uncertainty.
• Directly cutting issuance at the back end of the curve would be a more impactful signal than buybacks, especially for the 10-year yield which anchors mortgage rates.
• All eyes are on Kevin Warsh's upcoming speech for clearer guidance on Fed policy, inflation thresholds, and how it might influence longer-term yields and financial conditions.

Meghan Swiber discusses the US Treasury's use of buybacks to lower longer-term rates, noting it's a significant shift from historical practice. She questions the effectiveness of buybacks versus direct issuance cuts and highlights the potential for increased fiscal policy uncertainty. The conversation also touches on the upcoming Jackson Hole symposium and the need for clear communication from Fed officials like Kevin Warsh.