TREE NEWS reports: BNP Paribas said Treasury Secretary Scott Bessent should resist calls to eliminate the 20-year Treasury bond, warning that doing so could push borrowing costs higher. Bond traders are speculating whether Bessent will shift more government borrowing from long-term debt into short-term bills, with long-dated yields near multi-decade highs. Cutting or scrapping 20-year issuance has become an aggressive option because the tenor commands higher yields than adjacent maturities.
BNP Paribas Warns Against Scrapping 20-Year Treasury as Yields Near Multi-Decade Highs
AI take
The debate matters less as a product question than as a signal about how the Treasury is weighing duration against cost. Dropping a tenor that clears above its neighbours would shorten the average maturity of new issuance, leaving the government more exposed to refinancing risk if short rates move — the trade-off BNP is flagging. The read-through lands on the long end of the curve and on the dealers who warehouse it. Whether the 20-year survives, or borrowing tilts further into bills, is the open question.
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