Bessent Faces Tariffs, Iran, Bond Pressure at G20 Summit — SkimNews
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- Scott Bessent is hosting G20 finance ministers and central bank governors in Asheville, North Carolina on Monday and Tuesday, reviving the process after the U.S. shunned South Africa's G20 presidency last year.
- Bessent imposed curbs Friday on an Egypt-based bank over Iran-linked transactions through UAE branches and is warning G20 countries face secondary U.S. sanctions if they continue buying Iranian oil or facilitating Tehran transactions.
- The Iran war has kept the Strait of Hormuz closed, sapping growth from nearly all G20 economies, and Bessent is pushing to make Iran sanctions central to the agenda even though most counterparts want to talk tariffs instead, per Atlantic Council's Josh Lipsky.
- Trump's tariffs hit 60 economies in July at 10% or 12.5% for allegedly lax forced-labour enforcement; 16 top U.S. trading partners — more than half of them G20 members — face further tariffs under a separate probe targeting alleged excess industrial capacity.
- U.S. public debt crossed $40 trillion on Aug. 19 after doubling since 2017, and 30-year yields hit 19-year highs this month; Bessent responded by doubling scheduled buybacks of longer-dated Treasuries to $4 billion per operation.
- Bessent's bond-buyback move drew public criticism from his former Wall Street mentor Stanley Druckenmiller and raised concerns among central bankers about more interventionist Treasury action in a market built on "regular and predictable" issuance.
- China's exports surged 23.9% year-on-year in July, flooding Europe after being locked out of the U.S. market, with the IMF estimating the yuan is undervalued by 21% — a backdrop European officials say they want firmly on the Asheville agenda.
Why it matters: Bessent is asking G20 partners to tighten Iran sanctions and accept U.S. tariff pressure while U.S. public debt has crossed $40 trillion and 30-year yields sit at 19-year highs — but former Treasury G20 negotiator Mark Sobel says counterparts "won't buy into soothing words" on either the debt or the Iran war, and the G20's last major collective action was the 2020 COVID stimulus, suggesting consensus on any of these fronts is unlikely this week.
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