Mnuchin Still Has Hopes for Ultra-Long Bonds Even After 20-Year
Mnuchin Still Has Hopes for Ultra-Long Bonds Even After 20-Year
(Bloomberg) -- U.S. Treasury Secretary Steven Mnuchin indicated that he still has hopes to eventually issue 50- or 100-year bonds even after the department announced last week plans to add 20-year debt.
Amid haven buying Thursday as fears escalated over a virus spreading from China, long-end Treasuries outperformed the rest of the yield curve. But spreads were whipsawed in the wake of Mnuchin’s comments, which he made in an interview with CNBC in Davos, Switzerland.
“There’s no question we want to look at expanding our borrowing capabilities,” he said.
Treasury last week announced plans to reboot the 20-year sometime in the first half of this year. But with the federal budget deficit set to surpass $1 trillion, and the U.S. also facing a wall of debt starting to mature later this year, other maturities are still in the mix.
When asked if the reintroduction of the 20-year would drive ultra-longs off the agenda, Mnuchin said that’s “not necessarily” the case. “We’ve studied 50- and 100-year bonds very carefully. We can do the 20-year very quickly. It will take a little longer to do 50- and 100-year” from a technology standpoint.
--With assistance from Caitlin Webber and Edward Bolingbroke.
To contact the reporters on this story: Liz Capo McCormick in New York at emccormick7@bloomberg.net;Saleha Mohsin in Washington at smohsin2@bloomberg.net
To contact the editors responsible for this story: Benjamin Purvis at bpurvis@bloomberg.net, Mark Tannenbaum
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