The Federal Reserve is resisting pressure from the White House and Washington to spur big banks to buy more Treasury bonds, a reluctance that could further shake an unnerved market for US debt.
Wild swings in Treasury prices forced President Donald Trump to reverse course on his sweeping tariffs, and investors remain spooked even after his backtrack. Higher yields on government bonds are a sign of stress and eroding faith in the American government to pay its bills.
Still, the Fed isn’t accelerating regulatory changes that would encourage banks to load up on government debt, people familiar with the matter said, even though Treasury Secretary Scott Bessent and JPMorgan CEO Jamie Dimon both support the idea. Tweaks to rules that currently penalize banks for holding big slugs of Treasury bonds are instead winding their way through a painstaking internal process that could take months, the people said.
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