Treasury yields edge higher as U.S. and Iran exchange strikes
U.S. Treasury yields rose on Monday after the United States and Iran struck again militarily, further clouding the prospects of a deal to end the conflict.
10 year Treasury The yield, the key benchmark for mortgages, auto loans and credit card debt, rose more than 1 basis point to 4.4729% in early trading.
Yield 2 year Treasury The bond, which typically moves in response to short-term Federal Reserve interest rate decisions, was more than 2 basis points higher at 4.0390%.
30 year bond Meanwhile, the yield remained steady at 4.9958%.
One basis point is equal to 0.01%, or 1/100 of 1%, and yields and prices move in opposite directions.
Borrowing costs rose after US and Iranian airstrikes over the weekend, with both sides exchanging fire near the strategically important Strait of Hormuz shipping channel.
Bond yields were flat on Friday as traders closed the month monitoring geopolitical developments, amid signs that the United States and Iran are moving closer to a ceasefire extension.
But new uncertainty about the direction of the conflict caused oil prices to rise on the first day of June. Prices West Texas Intermediate Futures It rose more than 4 percent to 90.92 percent at the beginning of Monday. Brent crude oilThe price of oil, the international oil price benchmark, rose 3.6% to $94.37.
Later, the Institute for Supply Management will release its latest manufacturing index for May as investors continue to look for signs of rising costs in the U.S. economy.
According to consensus forecasts, the ISM’s manufacturing PMI is expected to rise to 53 from 52.7, unchanged from March, the highest level since April 2022.
Elsewhere, former Federal Reserve chairman Jerome Powell warned that the Trump administration’s move to force the central bank to cut interest rates risked undermining the public’s faith in the institution’s independence.
