The yield on the US 10-year Treasury note slipped by nearly 2 basis points to just under 4.21% on Tuesday, as traders positioned themselves ahead of the Federal Reserve’s two-day policy meeting against a backdrop of escalating conflict with Iran.
Oil prices climbed further as tensions mounted, with Iran intensifying attacks on energy infrastructure across the Persian Gulf and Israel reporting it had killed Iran’s security chief.
The Federal Reserve is widely expected to leave the federal funds rate unchanged when it announces its decision tomorrow. Attention will focus on the updated economic projections, as rising oil prices threaten both inflation and growth prospects, while the labour market shows emerging signs of softening.
