The yield on the US 10-year Treasury note slipped to around 4.47% on Monday, retracing part of last week’s advance as investors cautiously awaited the minutes of the Federal Reserve’s June policy meeting for fresh signals on the interest rate outlook. Data released last week showed that US nonfarm payrolls rose by only 57,000 in June, the smallest increase in four months and well below expectations of 110,000, prompting traders to scale back bets on a rate hike in September. At the same time, the unemployment rate unexpectedly edged down to 4.2%, largely reflecting a decline in the labor force participation rate to its lowest level since 2021.
Oil prices also declined as the normalization of energy shipments through the Strait of Hormuz, combined with the prospect of higher OPEC+ production, stoked concerns about a potential supply glut. This has helped ease inflationary pressures that had previously bolstered expectations for additional rate increases.
