“I am the house now, so when we intervene with the Japanese yen, I have pretty good insight into what the Japanese, what the Bank of Japan is going to do, what Japanese policymakers are going to do,” Bessent said. “And you can bet against me if you want.”

It — or they — wanted to.

In late July, the U.S. joined Japanese officials in buying yen in order to prop up the struggling currency. Although it wasn’t the Treasury’s stated intention, one concern surrounding its intervention was the risk that Japan, one of the largest holders of U.S. government debt, would offload a large chunk of U.S. treasuries to right the ship, which could send U.S. Treasury yields higher. Yields rise as the price of bonds fall.

Following the joint intervention, the yen has strengthened against the dollar, and this week it surged to a nearly seven-month high in Asia, showing stability likely celebrated by Bessent, who had previously said the yen was “undervalued.”  

In the $32 trillion Treasury market—simply the world’s most important, as it funds the U.S. government, sets global borrowing costs, and serves as the ultimate safe haven—Bessent’s warnings and actions have so far gone unheeded. 

The Treasury Department said Wednesday it would buy a maximum of $6 billion of 10- to 20-year bonds—above the $4 billion minimum it said it would buy last month. The buybacks are officially intended to add liquidity to the market, the Treasury Department said, but they also could help push yields down by adding demand. Yields are going up, though.

On Thursday, yields for 10-, 20- and 30-year Treasuries surged. The yield on the 10-year, which serves as a benchmark, hit 4.93% Thursday, its highest level since 2023 and dangerously close to exceeding 5%—a level it has only reached once before in the last two decades.

“Normally, when these red lines are put out, people like to test them,” Thomas Kikis, the head of markets for the U.S. & Americas at British bank Standard Chartered, told Fortune. “The market’s gonna give him a bit of a run over the next few days.”

White House spokesperson Kush Desai said in a statement to Fortune that Bessent’s past history of intervention with the Argentine peso last year shows just how effective Bessent can be at stabilizing markets. 

“Secretary Bessent has consistently leveraged — and augmented — his gravitas and the power of the American economy to deliver for both President Trump and the American people.” Desai said in a statement.

If the 10-year reaches 5%, investors may put more of their money into bonds, said Kikis, despite stocks trading near an all-time-high as the AI boom fuels market exuberance. Yet, persistently rising yields would be a negative for the government as it faces higher costs to borrow money at a time when the national debt stands at a whopping $40 trillion, its highest level ever. 

‘We can grow our way out of that’

Bessent, a legendary hedge fund trader, has often tried to stabilize the market with rhetoric. Last month, he shrugged off the $40 trillion debt, saying “we can grow our way out of that,” in an interview on CNBC’s Squawk on the Street.

This may actually be possible, said Kikis, who noted that the AI boom has helped fuel massive productivity gains in many industries while GDP has continued to grow, despite the disturbances to oil prices and global trade due to the Iran war.

“The corporates that I speak to are rather impressive in how they’re growing and how they keep on transforming their business,” he said.

Still, the recent bond market swings may show Bessent is “pushing at the edge of” his rhetoric strategy now, added Kikis. In order to really make a difference in yields, Kikis said Bessent may have to resort to cutting government spending, something the Trump Administration has been hesitant to do so far.

To be sure, surging yields in the bond market arrive as Brent crude settled at above $100 this week, its highest level since May, reviving fears that inflation could rebound. As U.S. debt soars, investors are asking for more compensation to lend the government money through treasuries.

While Fed Chair Kevin Warsh continues to emphasize a “quieter Fed” by cutting back on forward guidance, many traders have turned to Bessent to get a sense of how Washington is thinking about interest rates, treasury yields, and the markets, generally. 

While Bessent has not been as successful bringing the behemoth bond market to heel with his comments this week, his results with the yen and his reputation as a successful hedge fund manager may offer him some leeway for now, said Kikis.

However, it is yet to be seen how far his words will carry him as he continues to try to stabilize skittish markets.

“We’ll see how how far his power of influence carries, and I think the bond market will be the ultimate test,” he said.