FX.co ★ US 10-Year Yield Extends Fall on Haven Demand

On Monday, the yield on the US 10-year Treasury note declined to approximately 4.2%, marking a second consecutive decrease. This movement comes as investors gravitate towards safe-haven assets due to mounting concerns about the US economic outlook and the repercussions of escalating trade tensions. Over the weekend, President Donald Trump emphasized plans to enact reciprocal tariffs on all countries, reportedly pushing his advisers to adopt a more assertive approach to trade policies. There is market apprehension that such actions might provoke retaliation from major trading partners, drive inflation, and hinder economic growth. Furthermore, investors are keenly anticipating the monthly jobs report due on Friday, which could offer significant insights into the strength of the labor market and shape expectations surrounding Federal Reserve monetary policy. Recent data also revealed that personal spending increased slightly less than predicted, while core PCE prices, the Federal Reserve's preferred measure of inflation, rose more than expected, indicating ongoing inflationary pressures.