Citadel warns Treasury buybacks could weaken dollar, stoke inflation
Citadel Securities says Treasury’s expanded bond buybacks amount to “financial repression,” arguing they could suppress long-term yields, weaken the dollar and fuel inflation.
CITADEL WARNS BESSENT'S BUYBACKS COULD BACKFIRE Citadel Securities calls Treasury's expanded bond buybacks "financial repression," warning they could weaken the dollar and fuel inflation.
Bessent's strategy aims to suppress long-term yields, potentially using Treasury's cash reserves to fund purchases.
But Citadel argues intervention doesn't solve the underlying problem of high deficits and inflationary pressure — it simply shifts stress elsewhere.
The firm says lasting relief requires tighter fiscal policy and potentially higher Fed rates.