CNBC Daily Open: Treasury tries to rein in bond yields as US debt balloons past $40 trillion

Hello, my name is Hui Jie from Singapore. Welcome to another edition of CNBC’s Daily Open.

The U.S. Treasury can no longer tolerate rising borrowing costs and has decided to double its purchases of long-term bonds, pushing up stock prices while lowering yields.

But with the national debt now exceeding $40 trillion, the government may just be buying time. Inflation, the Iran war, and massive debt continue to plague the world’s largest economy.

The U.S. Treasury is considering expanding its repurchase operations for securities maturing in 10 to 30 years, doubling the size of each repurchase from “at least” $2 billion to at least $4 billion over the next two months.

Bond prices rose and yields fell following the announcement. of 30 year government bond yield It fell by about 9 basis points to about 5.19%, the biggest single-day decline since October 2025. The yield on the benchmark 10-year Treasury note fell to about 4.64%.

With this move, stock prices ended their losing streak on the 3rd, and all three major US indexes rose about 0.2%. Stock and bond yields generally move in opposite directions.

Debt buybacks also boosted cryptocurrencies. Bitcoin While earning more than 7% profit, ether It rose more than 18%. Cryptocurrencies are considered risky assets and typically benefit when U.S. Treasury yields fall.

The total US national debt exceeded $40 trillion for the first time in four and a half years after exceeding $30 trillion.

The government deficit so far this year has ballooned to $1.8 trillion. In its latest monthly accounting of U.S. finances, the Treasury reported a $432.3 billion deficit in July, the highest monthly total since March 2021.

Economic stimulus during the coronavirus pandemic has widened the budget deficit for years, pushing public debt to nearly 100%.

However, it is not just the size of the debt that is a concern. Debt interest this year will total nearly $1.2 trillion, making it the largest budget expense outside of Social Security and Medicare.

This may explain why President Trump is unhappy with borrowing costs. The president renewed his criticism of the Federal Reserve on Wednesday, saying interest rates are “artificially high” and arguing that the world’s largest economy should sharply reduce its debt payments.

“Countries like Switzerland have the highest interest rate in the world at 0.5%, but we pay 3.5%,” he said. “I have the absolute right to cut off all trade with countries like Switzerland.”

Trump also said the United States would launch an economic war against Iran, calling it “the most devastating economic operation ever waged against any country” and threatening harsh economic sanctions on countries that help Iran evade sanctions.

In a post on Truth Social, President Trump said Iran’s navy, air force and military production facilities had been destroyed and its currency was rendered “worthless” and claimed the Iranian regime was “hanging by a thread.”

The president cited oil smuggling, currency exchange lines, cash transfers, currency exchanges, ship registries and front companies as channels he wants to shut down immediately, and reiterated that Iran will never be allowed to acquire nuclear weapons.

Shares of pharmaceutical giants Moderna and Merck rose more than 177% and 12%, respectively, after the companies reported promising early results from late-stage trials of their experimental personalized cancer vaccines.

When this vaccine was combined with Merck’s blockbuster immunotherapy Keytruda, patients were spared their melanoma from coming back or spreading to other parts of the body significantly longer than with Keytruda alone.

Phase 3 trials will continue to evaluate other outcomes of the regimen, including overall survival benefit. The drug company plans to present the data at an upcoming international medical conference, but it’s unclear when it plans to submit an application for U.S. approval.

— Lim Huijie

NVIDIA is playing the role of matchmaker in Northern Europe as AI data center deals boom in the region, sources tell CNBC

Nvidia is acting as a matchmaker, trying to match companies with their own graphics processing equipment with data center operators with the ability to deploy it in Northern Europe, people told CNBC.

While establishing a de facto monopoly over the most powerful AI chips, Nvidia has been working to exert even greater influence across the AI ​​ecosystem as the race to build out infrastructure accelerates.

Semiconductor giants are also exploring a role in AI infrastructure deals. Two sources familiar with the matter told CNBC that NVIDIA has offered to introduce companies with data centers in Northern Europe, an increasingly sought-after region for AI infrastructure, to companies deploying its GPUs in the capacity market.

—Kai Nicole Schwartz