(Bloomberg) — Less than a week after deflecting calls for his resignation, Timothy Geithner sold bonds on behalf of U.S. taxpayers at the lowest yields on record in a show of confidence in the Treasury Secretary’s policies.

Even as the nation’s debt increased by $1.15 trillion this year to $6.95 trillion in October, the government’s interest expense under Geithner dropped 15 percent, the biggest decrease since before 1989, according to data compiled by Bloomberg. The Treasury auctioned $44 billion of two-year notes Nov. 23 at a yield of 0.802 percent, the lowest on record.

Rising demand shows investors believe Geithner, 48, is striking a balance between policies to promote growth and the borrowing needed to finance a $1 trillion deficit. The economy will likely expand 2.6 percent in 2010, after the government and Federal Reserve lent, spent or committed almost $12 trillion to keep financial markets from collapsing, according to the median estimate of 63 analysts surveyed by Bloomberg. That’s in line with average growth of 2.63 percent from 2002 through 2007.

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