First operation under expanded program coincides with rising yields and regulated fund selling
The U.S. Treasury accepted $5.187 billion in long-dated government bonds on Sept. 10, completing the first operation under its expanded buyback program targeting off-the-run securities, as spot Bitcoin ETFs recorded a net outflow of $282.7 million the same day.
The Treasury’s operation accepted 23 of 40 eligible issues offered against a $6 billion maximum. Securities ranged in maturity from February 2037 through August 2046. Demand for the buyback exceeded supply, with $10.489 billion in securities offered against the $6 billion ceiling. The Treasury describes itself as a price-sensitive buyer in its buyback guidance, allowing it to accept less than the maximum when offers do not meet its criteria.
The buyback program targets off-the-run bonds, older Treasury issues that trade less actively than newest benchmark bonds. The Federal Reserve Bank of New York has published research explaining that off-the-run bonds rely more on dealer intermediation and can benefit from a predictable buyer. The program is designed to support liquidity in these less-frequently-traded securities, though the study describes the initiative as modest relative to overall Treasury market volumes and dealer holdings.
Yields rise alongside macro events
On the same day as the Treasury operation, the 10-year nominal yield rose 12 basis points to 4.95%, while the 10-year real yield climbed 9 basis points to 2.55%. The European Central Bank raised three key rates by 25 basis points on Sept. 10. Producer price data released in August showed final-demand prices rose 0.4%, with year-over-year growth of 5.4%. Goods prices increased 1.1% and energy prices rose 4.2%.
Bitcoin’s reference close on Sept. 10 was $76,568, with the price at press time listed at $77,800. August U.S. consumer inflation data is scheduled for release on Sept. 11 at 8:30 a.m. ET.
ETF flows and liquidity signals
The $282.7 million net outflow from spot Bitcoin ETFs on Sept. 10 signals demand through regulated funds. According to Farside Investors, which tracked the flow data, ETF movements represent activity in registered investment products rather than proof of one-for-one spot market selling. Higher real yields raise the return hurdle for non-yielding assets like Bitcoin.
The Treasury operation occurred alongside multiple macro events, including the producer price release and the European Central Bank rate decision, preventing clean causal attribution of the buyback’s effects on Bitcoin fund flows or broader market conditions.
