Prediction Markets Skeptical That Treasury’s Bond Buybacks Will Lower Yields

Treasury Secretary Scott Bessent during a Senate Committee on Appropriations, Subcommittee on Financial Services and General Government hearing in the Dirksen Senate Office Building in Washington, April 22, 2026.

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Treasury Secretary Scott Bessent is employing a range of tools in an effort to curb rising bond yields. Yet, participants on prediction market platforms remain skeptical that these interventions will yield a sustained, dramatic decline in rates.

According to contracts on Kalshi, traders assign a 56% probability that the 10-year Treasury yield will finish 2026 at or above 4.75%, while only a 27% chance is priced in for the yield to end the year above 5%. As of midday Monday, the benchmark 10-year yield was trading around 4.7%.

Kalshi traders participate in a series of contracts predicting the closing level of the 10-year Treasury yield on December 31. These contracts are ultimately resolved using official data from the U.S. Treasury.

Despite the insights, trading volume on these specific contracts remains relatively low, totaling just over $16,500.

On Polymarket, speculators are pricing in roughly two-to-one odds that the 10-year Treasury yield will breach 4.8% at some point during 2026—a threshold the benchmark has not yet reached even during the recent bond market sell-off. These Polymarket contracts are also resolved using official U.S. Treasury data.

Last week, global bond markets faced a significant sell-off as investors weighed the risks of persistent inflation alongside the ongoing, unresolved U.S.-Iran conflict. Compounding these pressures, U.S. national debt surpassed the $40 trillion mark, further driving up domestic yields.

In response to the market turbulence, the Treasury Department announced plans to double its buybacks of U.S. debt in an effort to stabilize the bond market. While yields initially dipped following the announcement, they quickly rebounded in the days that followed.

On Monday, CNBC reported, citing senior officials, that the Treasury Department might consider utilizing funds from its $1 trillion General Account to help finance the increased debt buybacks.

Following the report, yields declined once again. However, prediction market traders are betting that this downward move will be short-lived, with yields ultimately resuming their upward trajectory.

Disclosure: CNBC and Kalshi have a commercial relationship that includes customer acquisition and a minority investment.

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