The yield on the US 10-year Treasury note fell nearly 9 basis points to 5.04%, the lowest level in about a month, as a broad flight to safety driven by renewed equity market volatility boosted demand for government debt. Risk appetite weakened amid concerns about stretched AI-related valuations and elevated capital spending, while escalating geopolitical tensions in the Middle East further supported safe-haven flows. Reports that the US and Israel are preparing additional strikes on Iran following the midterm elections added to investor caution.
Looking ahead, the Federal Reserve is scheduled to announce its monetary policy decision next week. Futures markets are currently assigning roughly an 89% probability that the Fed will leave interest rates unchanged, while the implied odds of a 25-basis-point increase in December have climbed to around 76%. On the data front, the latest jobless claims figures showed initial claims falling to their lowest level since July.
