Bond yields crept higher again on Thursday as the impact of Treasury Secretary Scott Bessent's vow to "at least double" longer-dated buybacks faded against the backdrop of a federal debt milestone-$40 trillion.

Bessent's remark, in a surprise statement on Wednesday, came after a sharp selloff in longer-dated bonds that pushed the yield on a 30-year note to its highest since 2007 and drew auction yields for the 10-year note last week that match levels before the 2007-08 financial crisis.

The initial impact of the Treasury buybacks, which would take the sizeto "at least $4 billion per operation" when the program begins in September, clipped nearly 10 basis points from the 30-year yield and lowered the rate on the 10-year by 7 basis points.

Bessent revived the buyback program last year, calling it part of a "big tool kit" that the Treasury has to manage disruptions in the bond market.

"It's clear that the Treasury is ready to place a limit to the upside for longer-dated yields," said Padhraic Garvey, ING's regional head of Americas research. "The impact of the increased buybacks is not so much on the doubling of them in long dates, but more so on the implied reality that they could be doubled again, and again if needed."

That trade was unwinding on Thursday, however, as markets digested both the Treasury's motives and the massive $40 trillion federal debt-the first on record. The number is expected to hit $50 trillion before the end of the decade.

The benchmark 10-year note was trading at 4.7%, while the 30-year was changing hands at 5.23%. Stocks were also drifting lower.

Inflation was on Wall Street's mind, too, as global crude prices topped $94 a barrel in overnight dealing-up about 18& in the past three weeks. Again, Thursday's increase came after yet another collapse in peace talks between Washington and Tehran, and warnings of economic sanctions from President Donald Trump.

Minutes of the Federal Reserve's July policy meeting, released Wednesday, showed policymakers are concerned that inflation risks aree "skewed to the upside." Many noted that "policy tightening would likely be necessary if inflation did not decline."

The mix of inflation, fiscal largess, and an interventionist Treasury Secretary, who deemed his job only last year "to be the nation's top bond salesman," is expected to dog the Treasury market well into autumn.

"Bessent is again showing his tactical skill as an activist Treasury Secretary," said Krishna Guha, head of economics and central bank policy at Evercore ISI. "But we are skeptical that this operation will have a material impact over any more extended period."

Unlike the Fed, the Treasury can't print money to finance its bond buying, which means longer-dated purchases will have to be offset by new issues-probably short-dated Treasury bills.

It isn't yield-curve control, Guha added, but is at best "somewhat analogous to a very small-scale Operation Twist," a reference to a Fed tactic of lowering longer-dated Treasury yields while lifting shorter-dated ones, effectively reducing the spread between the two.

It might work if "investors read Bessent's readiness to shift new issuance toward shorter tenors," Guha added. "But it would come with risks and would not go so far as to neutralize the issuance problem."

That problem is real: Gross Treasury sales have totaled nearly $19 trillion this year, a 10.2% increase from last yes, with the net figure expected to top $2.1 trillion by year's end.

And the fiscal constraints are real, too.

Debt service costs are at roughly 3.3% of GDP, according to LPL Financial's Lawrence Gillum, and are now the third highest line item in the federal budget behind Social Security and Medicare.

"At some point that number forces the Treasury, and by extension the broader market, to care about lower yields again," said Gillum, LPL's chief fixed-income strategist. "But this is more of a Band-Aid than a panacea."