US Treasury Taps Big Holders of 30-Year Bond in Regulatory Drill

2025-09-09 18:22:45

Abstract generation in progress

The US Treasury building in Washington, DC.

(Bloomberg) -- The US Treasury Department asked large holders of a 30-year Treasury security in early June to identify themselves.

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Under rules used sporadically since the 1990s to guard against market manipulation, the department specified anyone whose position in the 4.625% bond maturing in February 2055 amounted to $6.9 billion or more as of June 2, 2025, when it was the second-newest 30-year bond in existence. The department requested reports from those holders before 12:00 p.m. on Sept. 15, according to a statement released Tuesday.

Unlike last year, when the so-called large-position-report request targeted big holders of a 20-year bond that had shown signs of scarcity, Tuesday’s call names a bond for which there have been no major indications of possible market manipulation.

For example, there were no surges in failures to complete transactions in 30-year bonds in Federal Reserve Bank of New York data at the time. Also, demand on the part of dealers to borrow the issue from the New York Fed in its daily securities lending operation remained light, with requests peaking at $1.56 billion on June 2 out of the $9.821 billion available to borrow, data show.

Treasury said in a related report it doesn’t believe that large positions “are inherently problematic” or “presume there is manipulative or illegal intent on the part of entities that control large positions in a particular Treasury security.”

The department announced in July that they’d be conducting a large position report during the following three months. It has tended in recent years to ask for these reports about once a year. The protocol was established in the 1990s and aims to prevent improper trading activity, such as efforts to corner the supply of a security to drive up the cost of closing short positions. This is the 22nd such request to date.

While long-term Treasuries have rallied over the past week, demand for them this year has suffered at various points based on perceived risk of accelerating inflation and fiscal trends that prompted Moody’s Ratings to lower the US credit score in May.

--With assistance from Alexandra Harris.