FX.co ★ Treasury Yields Swing on Trade Uncertainty, Fresh PCE

On Friday, the yield on the US 10-year Treasury note hovered around 4.4%, as traders analyzed the latest trade developments and new economic data. President Trump alleged on social media that China had "totally violated" its agreement with the US, without providing additional specifics. On Thursday, a federal appeals court temporarily reinstated Trump’s tariffs, just a day after a trade court ruled he had exceeded his authority. Regarding economic data, the PCE price index met expectations, with both the headline and core figures increasing by 0.1% month-over-month. Year-over-year, both measures decelerated, offering some respite from inflationary pressures. Personal spending growth also declined to 0.2%, aligning with predictions. This data supported expectations that the Federal Reserve might have the capacity to reduce interest rates later this year. For the month of May, the benchmark bond yield in the US has decreased by more than 20 basis points.