PNN – Politico reported that Iran represents a new front of pressure on the economic policy of Donald Trump’s administration.
According to the report of Pakistan News Network; a Politico report—focusing on the challenges facing U.S. Treasury Secretary Scott Bessent in managing the country’s bond market—identifies Iran as a new source of pressure on the Trump administration’s economic policy.
The report notes that Bessent is contending with rising long-term Treasury yields and waning investor confidence in Washington’s fiscal policies, all while simultaneously assuming expanded responsibilities in the realms of foreign and economic policy.
On Monday, he also announced new sanctions and threats against countries trading with Iran, dubbing the move “Economic D-Day.”
Politico reports that the conflict with Iran has roiled oil markets, and rising energy prices have fueled an increase in long-term borrowing costs in the U.S.; this is because rising oil prices intensify inflationary pressures and complicate the outlook for interest rate cuts.
The report states that Basant is now attempting to intervene on multiple economic fronts simultaneously—ranging from the U.S. bond market and the Japanese currency to the economic war against Iran.
Eric Wallerstein, Chief Macro Strategist at Clocktower Group, has stated that “the Treasury is intervening on too many fronts,” making it difficult for an institution with limited manpower to manage the situation.
Politico also highlights that U.S. government intervention aimed at lowering long-term bond yields have so far failed to produce a lasting effect. Rates have rebounded after initial declines, raising questions about the Treasury’s ability to manage financial markets.
Meanwhile, rising oil prices resulting from a war with Iran—and the associated inflationary pressures—could drive up U.S. government fiscal costs and private sector borrowing.
In a report criticizing the Trump administration’s policy toward Iran, The Telegraph writes that the campaign dubbed “Economic D-Day”—aimed at forcing Tehran to capitulate—could erode domestic political support for war before it actually compels Iran to back down.
The Telegraph notes that the U.S. is seeking to exert economic pressure on Iran’s partners even as it relies on a steady influx of capital from those very nations to cover its twin budget and current account deficits, and faces high borrowing costs.
In an editorial criticizing the Donald Trump administration’s approach toward Iran, The Independent also described the launch of a new economic war against Tehran as a sign that the war’s initial objectives had failed, noting that “D-Day for the economy” is unlikely to enable the U.S. to achieve its goals.