Steven Mnuchin, the “Treasury Secretary” of the U.S. doesn’t see the country buying back debt while his plan is to borrow long-term money so as to “lock in low interest rates” while the uncertainty of COVID-19 pandemic sways the economy. Talking to CNBC in ana interview, Mnuchin said:
“One of the reasons I do feel comfortable with us spending all this money is because interest rates are very low. And we’re taking advantage of long-term rates”.
“Because of the amount of debt we have in short-term that does roll off and the amount of debt we’re using for these deficits, I think we have tremendous opportunities without needing to buy back debt”.
Last week, the U.S. Treasury came out with a “record-busting plan” of burrowing “$3 trillion” during Q2 for funding the “economic rescue programs” besides covering up “a massive drop in revenues”. Moreover, a new twenty-year bond was also launched for extending maturity period. While, Mnuchin informed that even though the Treasury considered “longer maturities” but they found the twenty-year period to hold stronger demand.
However, it was yet unclear if the unemployment figure for May would be better or worse in comparison to the “14.7% recorded in April”. Nevertheless, the Treasury chief sounded optimistic about reopening businesses in summer. While, Mnuchin added:
“We’re very sympathetic to all the workers who this is impacting, if the numbers are worse next month, you know, we understand that. But I think the numbers are going to be getting better as we go into the summer and we reopen the economy.”
References:
reuters.com
“One of the reasons I do feel comfortable with us spending all this money is because interest rates are very low. And we’re taking advantage of long-term rates”.
“Because of the amount of debt we have in short-term that does roll off and the amount of debt we’re using for these deficits, I think we have tremendous opportunities without needing to buy back debt”.
Last week, the U.S. Treasury came out with a “record-busting plan” of burrowing “$3 trillion” during Q2 for funding the “economic rescue programs” besides covering up “a massive drop in revenues”. Moreover, a new twenty-year bond was also launched for extending maturity period. While, Mnuchin informed that even though the Treasury considered “longer maturities” but they found the twenty-year period to hold stronger demand.
However, it was yet unclear if the unemployment figure for May would be better or worse in comparison to the “14.7% recorded in April”. Nevertheless, the Treasury chief sounded optimistic about reopening businesses in summer. While, Mnuchin added:
“We’re very sympathetic to all the workers who this is impacting, if the numbers are worse next month, you know, we understand that. But I think the numbers are going to be getting better as we go into the summer and we reopen the economy.”
References:
reuters.com
