ING Rates Spark: US Treasury Buybacks, Swap Spreads, and Market Volatility

US Treasury long-end buybacks have compressed the 30yr swap spread by 6bp, but focus is pivoting to the front end ahead of Jackson Hole and US PCE data. Meanwhile, market-implied volatility remains unusually subdued despite geopolitical tensions in the Middle East and high European gas prices.

Key Takeaways

• 1.The US 30yr swap spread has tightened by ~6bp following Treasury buyback announcements, reflecting a material richening of long-end Treasury yields relative to long-end SOFR rates.
• 2.Market-implied volatility measures such as the VIX and short-end euro rate volatility are near benign lows despite intensifying geopolitical risk headlines in the Middle East and elevated energy prices.
• 3.Fed Chair Warsh is expected to remain balanced and non-committal at the Jackson Hole Symposium regarding elevated deficits and rate cuts, while front-end carry spreads remain ambiguous on further hiking.

Table of Contents

• US back end behaves itself as focus slowly switches to the front end
• Market-implied volatility measures do not reflect intensification of geopolitical risks
• Wednesday’s events and market views
• Author
• Disclaimer

Report data

With the 30yr swap spread continuing to edge lower, attention turns to the front end and the Jackson Hole Symposium

Reports in this series

Rates Spark is shown in chronological order through this edition, published on August 25, 2026.

Part of the Rates Spark series — view all 32 editions

Looking for the latest edition? ING Think rates spark so how bad could this whole thing get (Sep 2, 2026)

1. May 14ING-Think-rates-spark-the-evaporation-of-real-yields
2. May 15ING-Think-rates-spark-flip-the-gaze-from-china-back-to-iran
3. May 19ING-Think-rates-markets-have-shifted-to-a-broader-inflation-impact
4. May 20ING-Think-rates-spark-still-exposed
5. May 22ING-Think-rates-spark-differences-brought-into-sharper-relief
6. May 27ING-Think-rates-spark-up-and-down-with-oil
7. May 28ING-Think-rates-spark-plenty-of-supply-as-we-approach-summer
8. May 29ING-Think-rates-spark-watch-inflation-expectations-drift-higher
9. Jun 3ING-Think-rates-spark-the-real-deal
10. Jun 4ING-Think-rates-spark-spread-exposures
11. Jun 10ING-Think-rates-spark-oil-losing-control
12. Jun 11ING-Think-rates-spark-bracing-for-a-hawkish-ecb
13. Jun 12ING-Think-rates-spark-oil-still-key-to-ecb-outlook
14. Jun 15ING-Think-rates-spark-the-damage-has-been-done
15. Jun 23ING-Think-rates-spark-gilts-dont-like-political-uncertainty
16. Jun 24ING-Think-rates-spark-bonds-back-to-hedging-market-risks
17. Jun 25ING-Think-rates-spark-more-repricing-risk-at-front-end
18. Jun 30ING-Think-rates-spark-too-early-for-the-doves
19. Jul 1ING-Think-rates-spark-uk-political-risk-closely-tied-to-inflation-outlook
20. Jul 3ING-Think-rates-spark-resumed-steepening-impulse
21. Jul 7ING-Think-rates-spark-potential-relief-for-gilts-amid-a-bearish-bias
22. Jul 8ING-Think-rates-spark-another-push-higher-in-real-rates
23. Jul 10ING-Think-rates-spark-markets-looking-through-geopolitical-risks
24. Jul 15ING-Think-rates-spark-eur-rates-cannot-follow-a-dovish-us
25. Aug 17ING Think rates spark heavy treasuries and tight eurozone liquidity
26. Aug 17ING Think rates spark xxxxxxxxx
27. Aug 24ING Think rates spark its about bigger buybacks not how its financed

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