HIGH DEMAND and LOW RATES: U.S. Treasury Sec Mnuchin Says US Has No Need to Buy Back Debt
Posted on 05/11/2020
U.S. Treasury Secretary Steven Mnuchin informed the public that the United States has no need to buy back debt. Mnuchin revealed he plans to borrow money long-term to lock in low interest rates, as global central banks have continuously lowered rates in an accelerated fashion due to the viral pandemic.
“One of the reasons I do feel comfortable with us spending all this money is because interest rates are very low. And we’re taking advantage of long-term rates,” Steven Mnuchin said in a CNBC interview on May 11, 2020. He added, “Because of the amount of debt we have in short-term that does roll off and the amount of debt we’re using for these deficits, I think we have tremendous opportunities without needing to buy back debt.”
The U.S. Department of Treasury unveiled a plan to borrow US$ 3 trillion during the April-June 2020 quarter to fund coronavirus economic rescue programs and cover a massive drop in revenues. Furthermore, the department launched a new 20-year bond to extend maturities.
