White House Mulls New 50-, 25-Year Bonds to Finance Stimulus

White House economic adviser Larry Kudlow likes the idea, one of the people said. Treasury Secretary Steven Mnuchin, although initially skeptical, is now more willing to do it, the people said.

The Treasury yield curve steepened initially on the report that the administration is revisiting the idea of selling ultra long-term debt. The gap between 2- and 10-year yields widened from about 60 basis points to as much as about 66 basis points before reversing much of the move.

Mnuchin said on Fox Business News Wednesday that he concluded in January that there wouldn’t be enough investor demand for ultra-long bonds, but that now “we’re going to take advantage of low interest rates.”