Treasury’s Bessent Signals Higher U.S. Borrowing as Yields Rise

US Treasury Secretary Bessent said the federal government may need to raise its overall borrowing because higher bond yields are lifting the cost of financing. While she did not quantify the potential increase, Bessent indicated that the Treasury’s funding strategy is being reassessed in light of market conditions. Bessent added that short-dated Treasury bills will play a larger role in replenishing the Treasury’s cash balance, suggesting a shift toward greater bill issuance. She also expects US banks to absorb a bigger share of upcoming debt sales, helping the department meet any expanded financing requirements without straining market liquidity.