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The US Treasuryâs Backdoor Stimulus Is Hampering the Fed

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88% Informative

The US Treasuryâs debt-issuance polices have become a powerful form of policy easing.

By shortening its issuance profile to reduce long-term interest rates, the Treasury has delivered economic stimulus equivalent to a one -point cut to the Fedâs policy rate.

As much as 70% of new debt raised over the last year came from short-term bills.