Overview
- Last week the yield on the 30-year Treasury jumped to a 19-year high as investors reacted to the national debt approaching roughly $40 trillion, signaling higher borrowing costs for government and private borrowers.
- The Treasury expanded debt buybacks in response, and Secretary Scott Bessent publicly rejected the idea that the administration would seek to harm global markets when announcing new Iran sanctions.
- The White House has taken limited, targeted steps to ease price pressures, including allowing 300,000 tons of ground beef to enter at lower tariffs, even as the U.S. and Canada announced billions in new retaliatory tariffs.
- Recent data show the economy is softening: retail sales fell in July for the first time in nine months and reporting indicates the economy also lost jobs, raising concern about consumer prices and hiring.
- Economists and former officials say a large share of the strain traces to policy choices—major tax cuts and big defense spending increases—and warn those choices, together with trade disruptions and Iran-related oil risk, could keep rates and inflation elevated and influence voters ahead of the midterms.