Bitcoin surges past US$80,000 as investors hedge against dollar weakness

Buybacks do not remove underlying debt concerns

The Treasury has maintained that the buyback programme is intended to support the functioning and liquidity of the bond market rather than deliberately reduce the dollar’s value.

The department also plans to continue its regular debt-auction schedule. As of August 24, no bonds had yet been repurchased under the expanded programme, which means the immediate market reaction was driven largely by expectations and the signal sent by the announcement.

Nevertheless, investors have questioned whether market intervention can provide a durable solution while underlying fiscal pressures remain unresolved.

If the authorities prevent long-term yields from rising sufficiently to reflect concerns about federal debt and deficits, traders fear that the adjustment could instead emerge through dollar weakness, inflation expectations or greater demand for assets outside the traditional financial system.

Debate over Bessent’s increasingly active approach was also intensified by the Treasury’s participation in a rare co-ordinated intervention with Japan earlier in August to support the yen. Reuters reported that the US side sold euros to purchase yen rather than selling dollars directly.