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Bessent’s bond push raises questions about Fed independence for Warsh

The effort to influence long-term Treasury yields could require Warsh to spell out how much coordination the Fed can have on bond and balance sheet decisions.

Reported · Written up by our desk · Central Banks

CNBC Markets reports that the incoming push by Bessent to tamp down long-term Treasury yields may create a test of how independent the Fed’s approach remains.

The concern is that any attempt to manage the bond market could force Warsh to clarify the extent to which the Fed should coordinate on Treasurys, including actions tied to the central bank’s balance sheet.

In that context, the report frames the issue as less about day to day rates and more about the Fed’s mandate and boundaries in responding to pressure linked to long-term yields.

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