FX.co ★ US 10-Year Treasury Yield Falls Below 4%

The yield on the US 10-year Treasury note initially dropped by 16 basis points before partially rebounding to 3.97%, as investors balanced robust employment figures against heightened trade tensions. The US labor report revealed that the economy gained 228,000 jobs in March, surpassing the anticipated 135,000, while the unemployment rate rose to 4.2%, maintaining signs of a strong labor market. On the trade front, China announced a 34% tariff on all US imports along with export controls on rare earths effective April 10, countering the recent US tariffs imposed by President Trump. This cycle of retaliatory tariffs has intensified market uncertainty, with expectations that it could drive up inflation and hinder economic growth. Consequently, there is growing speculation in the markets about potential interest rate cuts, with current forecasts including at least four quarter-point decreases this year, and the possibility of a fifth.