- 12th September 2019
- Posted by: Muff lbr
- Category: Economics, Finance & accounting
- The U.S. is “seriously considering” issuing a 50-year bond next year, Treasury Secretary Steven Mnuchin tells CNBC.
- His comments come the day after President Trump said the U.S. should consider “refinancing” its $22.5 trillion debt load.
The U.S. could be issuing 50-year bonds as soon as next year as the government looks for cheaper and longer-term ways to finance its burgeoning debt load, Treasury Secretary Steven Mnuchin told CNBC on Thursday.
“This is something I have talked about over the last two years, it is something we are very seriously considering,” he said on “Squawk Box.” “We’re looking at issuing a 50-year bond, what we could call an ultra-long bond. We think there is some demand for it. It is something we’ll very seriously consider for next year.”
Mnunchin’s comments come a day after President Donald Trump tweeted that he thinks the U.S. should look at “refinancing” its debt load, which has recently eclipsed the $22.5 trillion mark. Government bond yields moved lower as Mnuchin spoke.
Though it’s unlikely the government could engage in that process the way a homeowner would refinance a mortgage, Treasury could extend the maturity of the debt by issuing longer-term bonds. The longest duration the government has now is the 30-year bond.
More than a dozen other developed countries have issued “ultra” bonds of durations from 40 to 100 years. Canada issued a 50-year bond in 2014 while Mexico, Belgium and Ireland have offered 100-year debt in recent years. Multiple companies also have issued 100-year bonds.