Scott Bessent’s Remarks in Buenos Aires
Scott Bessent, in an interview with Bloomberg Television in Buenos Aires, Argentina, stated that he does not believe foreign investors are selling off U.S. Treasury bonds. He pointed out that the results from last week’s auctions of 10-year and 30-year U.S. treasuries actually indicate an increase in demand from foreign investors.
In light of the U.S. Treasury bonds experiencing their largest weekly decline since 2001 last week, along with the simultaneous weakening of the dollar, concerns about a loss of confidence in U.S. assets have arisen. Scott Bessent believes that this volatility primarily stems from technical factors related to “de-leveraging,” rather than reflecting a massive withdrawal of sovereign funds. He noted that he has seen no evidence suggesting that sovereign nations are the main cause of this sell-off.
Scott Bessent remarked that the Treasury is still some distance away from taking intervention measures, but he emphasized that “if there is indeed a need, the Treasury has a wealth of tools to choose from.” He further indicated that one possible measure could be to expand the scale of existing repurchase operations to alleviate market liquidity pressures.
When asked if potential response strategies were discussed during his recent meeting with Federal Reserve Chairman Jerome Powell, Scott Bessent replied, “We have not yet reached the stage where any emergency plans need to be implemented.” Regarding whether Powell is concerned about this situation, Bessent responded:
“If he were truly worried, I believe we would have already heard him speak publicly about it.”
