The US Treasury Department is currently issuing many more long-term bonds to give it a chance to finance a $ 3 trillion government debt. This increases the likelihood that yields on these bonds will increase as investors demand higher compensation for this additional offer. On the other hand, the Fed is trying to suppress the issuance of long-term bonds and at the same time support the economy. At the beginning of the crisis, asset purchases were aimed at stimulating the economy. Since then, however, they have become a tool for further easing by reducing graduation premiums and pushing investors to more risky assets.

But fear of such instruments will not be enough to meet policy objectives within a reasonable timeframe, so the Fed plans further steps to boost the economy. Fed Chairman Jerome Powell is trying to persuade Congress to support the economy with fiscal spending. Powell even tried to motivate the Speaker of the House to think "without fiscal constraints." The Fed has promised not to oppose fiscal stimulus to the economy. However, if the Fed allowed interest rate increases on long-term bonds, questions would arise about the binding nature of this promise, as well as the commitment to keep rates low at the short end of the yield curve.

It looks that Fed does not want the mere issues of the Treasury to trigger a sharp rise in the yield curve. The bet on the growth of the curve should instead be a bet on growth and inflation.