Treasury Buyback Plan Sends Dollar Reeling, Gold Surges

The Treasury Department's plan to double its long-term bond buyback programme has triggered a sharp repricing across asset classes. Gold and bitcoin both jumped as the dollar slid, with investors interpreting the move as a signal that Washington may be growing more tolerant of currency weakness to ease debt servicing pressures.

With US federal debt now above $40 trillion and oil prices elevated, the buyback expansion follows a week of surging Treasury yields. While the intervention briefly lowered borrowing costs and improved market liquidity, it has raised deeper questions about long-term dollar policy.

For FX traders, the takeaway is clear: any further liquidity injections or yield-curve management from Treasury could extend dollar softness, keeping pressure on DXY even as the Fed's own stance remains data-dependent.