Treasury yields move higher as Middle East peace talks falter
Yields on U.S. Treasurys moved higher at the start of a new trading week as traders monitored geopolitical developments around the Middle East conflict ahead of President Donald Trump’s meeting with China premier Xi Jinping in Beijing later this week.
The yield on the 10-year U.S. Treasury note — the key benchmark for government borrowing — was more than 2 basis points higher at 4.3863%.
The 2-year Treasury note yield, which is more sensitive to short-term Federal Reserve interest rate decisions, also rose by 2 basis points to reach 3.9202%. The longer-dated 30-year Treasury bond yield was 1 basis point higher at 4.9648%.
One basis point is equal to 0.01%, and yields and prices move in opposite directions.
The war in Iran returned to the spotlight on Monday amid signs that the plans for a peace agreement — which lifted markets last week— could be stalling.
President Trump blasted Iran’s counterproposal to end the 10-week conflict as “totally unacceptable”, while Iranian President Masoud Pezeshkian said his country would “never bow” to its enemies.
Oil prices edged back up toward $100 a barrel in early dealmaking Monday, with West Texas Intermediate futures last seen up 3.8% at $99.02.
Domestically, jobs data outperformed expectations for April, with nonfarm payroll rising 115,000. That was down from 185,000 in March, but well above the 55,000 forecast by economists surveyed by Dow Jones. Unemployment, meanwhile, held steady at 4.3%.
Austan Goolsbee, president of the Federal Reserve Bank of Chicago, said the jobs picture has “been stable without being good.” He told CNBC that there is “not a lot of evidence that the job market is falling apart,” but he conceded that the hiring rate remains low.
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