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D deepakshenoy
Deepak Shenoy
@deepakshenoy

Move follows the data release by the US where they show UK, Norway, UAE, Japan and China selling treasuries in June. Buybacks is from treasury (not the fed) so it doesn't add to liquidity, but they're financing it with short term TBills - so techniclaly replacing long term debt with short term. India just did the opposite - the government replaced near term debt (2026/7 maturity) with longer term (10y or more), which avoids maturity and rollover pains.

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After bond vigilantes took US long duration bonds higher. Fed is at least doubling liquidity support buybacks for longer dated Treasuries (10–20yr & 20–30yr) to 4B+ per operation (from $2B). Effective Sept 9 to Nov 4. IMHO, this flattens the US curve by raising the short end with excess supply.

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P pshahani1
Parikshit Shahani @pshahani1 ·

@deepakshenoy Yes, have already been shortening weighted avg duration for the past few years. These buybacks add to it further. Just means Fed hikes will get more and more painful since debt is now mostly in the short end. Bessent is counting on Warsh to cut (or atleast not hike)

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M mayank0007
Mayank Sharma @mayank0007 ·

@deepakshenoy Reactive US response to global sell off in their long term bonds, simply borrowed from short term to pay for long; how can it help? Short term bond yields may rise if not enough market for short term bonds, creating pressure on Fed to increase rates, not good before the mid term.

1
M pryce_josh72680
Mr Pryce. @pryce_josh72680 ·

@deepakshenoy Psalms 73:23 (NIV) Yet I am always with you; you hold me by my right hand.

𝗖 CaptVenkatReddy
𝗖𝗮𝗽𝘁.𝗩𝗲𝗻𝗸𝗮𝘁 𝗥𝗲𝗱𝗱𝘆 @CaptVenkatReddy · C

@deepakshenoy @Prateekonomics Inflation may write it's own story. Brazil 1990 Story Japan 2010 to 2024 YCC story will repeat.👇

S sandeepvbelure
Sandeep @sandeepvbelure ·
V Vibhutisharma99
Vibhuti Sharma-SEBI Registered Research Analyst @Vibhutisharma99 ·

@deepakshenoy Interesting contrast between the US and India here. Extending maturities may not look exciting but it can really help reduce rollover pressure later.

A amancool5
Aman Sharma @amancool5 · B

@deepakshenoy And yet the 10Y yields are higher than before.

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P SunnyElino49620
Precise market analysis... @SunnyElino49620 ·

@deepakshenoy My internal planning. 🔻 🔻 chatgpt.com/share/6a8730d1-8f3…