JPMorgan analyst James Sullivan warned on Friday that Washington’s push to ease pressure in the Treasury market may simply postpone a deeper problem, comparing the intervention to “paying your mortgage with your credit card.” His comments came as bond yields climbed back toward pre-announcement levels within days.
The U.S. Treasury Department said Wednesday it would at least double the size of its planned purchases of longer-term government debt. On Thursday, Treasury Secretary Scott Bessent indicated the repurchase program could grow larger still, an attempt to steady a market rattled by high borrowing costs.
The response was brief. The announcement temporarily pulled government bond yields lower, but by early Friday the 10-year Treasury yield stood at around 4.71%, up from nearly 4.64% on Thursday and back near where it sat before the plan was unveiled. The 30-year yield rose to roughly 5.26% from 5.18%.
Yields have stayed elevated on worries about persistent inflation, tied partly to the war in Iran, and rising U.S. government debt. Higher yields tend to slow the broader economy by lifting borrowing costs across the financial system, and they can weigh on stock prices.
Wall Street retreated in the prior session, and Asian markets opened mixed on Friday as the Treasury moves failed to reassure investors. Japan’s Nikkei 225 slipped 0.2% to 66,080.25, while South Korea’s Kospi climbed 0.9% to 6,914.09. Hong Kong’s Hang Seng added 0.7% to 25,888.36, and the Shanghai Composite was unchanged at 3,903.81.
Australia’s S&P/ASX 200 traded 0.3% lower at 9,053.90, Taiwan’s Taiex gained 0.4%, and India’s Sensex was 0.1% weaker. U.S. futures edged higher after the session’s losses.
Bond yields rose across Asia as well. Japan’s 10-year government bond yield, which had been trading near 30-year highs, climbed to 2.88% from around 2.83% a day earlier, reflecting the same pressures unsettling investors elsewhere.
For borrowers, the persistence of elevated yields means mortgages, corporate loans and consumer credit stay costly regardless of the Treasury’s buyback effort. Analysts expect any relief from the program to prove short-lived unless the underlying inflation and debt concerns ease.
Concerns from JPMorgan’s leadership about market fragility are not new, echoing earlier warnings from chief executive Jamie Dimon about underestimated economic risks and market complacency. The Treasury is now expected to detail the scale of its expanded purchases in the coming weeks, with markets watching whether the intervention gains traction or fades again.