Bessent Urges Fed to Expand FIMA Repo Facility as Japan’s $1.1 Trillion Treasury Demand Wanes
Updated
Updated · Yahoo Finance · Sep 3
Bessent Urges Fed to Expand FIMA Repo Facility as Japan’s $1.1 Trillion Treasury Demand Wanes
3 articles · Updated · Yahoo Finance · Sep 3
Summary
Scott Bessent asked the Federal Reserve to enlarge its FIMA repo facility after Japan signaled it would use the program following a July 31 yen-support intervention.
The facility lets Japan swap Treasurys for dollars temporarily instead of selling them outright, a backstop for a bond market already strained by elevated long-term yields.
Japan matters because it holds about $1.1 trillion in Treasurys, but 10-year Japanese government bond yields near 3% now give domestic investors more reason to keep money at home.
Treasury data through June show Japan-based investors sold a net $71 billion of US government debt, though roughly $69 billion was in short-term bills and only $3 billion in longer-dated notes and bonds.
Bessent’s push suggests Washington expects pressure from weaker Japanese demand and possible yen interventions to persist as 30-year Treasury yields hover near their highest since 2007.