Treasury’s Bessent Says Yield Curve May Fall, Presses Japan on Inflation

US Treasury Secretary Bessent said the Biden administration remains committed to keeping inflation expectations anchored and argued that the current level of 30-year Treasury yields signals market confidence in that stance. Bessent attributed recent moves in US long-term yields in part to what she called "leakage" from Japan and parallel spikes in German bonds, noting that the US 30-year "dragged along" with overseas benchmarks. She urged Tokyo to bring its inflation under control and said she has discussed the matter with Bank of Japan Governor Kazuo Ueda. Looking ahead, Bessent said the entire US yield curve could shift lower and that she does not believe the Federal Reserve needs to restart large-scale asset purchases. She added that the Treasury is replenishing its cash balance primarily through bill issuance.