FX.co ★ US 10-Year Yield Hits 5-Week Low

On Friday, the yield on the US 10-year Treasury note fell to approximately 4.34%, its lowest in five weeks, as investors sought the relative safety of these assets in response to escalating tensions in the Middle East. This drop followed Israel's preemptive strike on Iran, which targeted nuclear facilities, along with their commitment to continue operations until the perceived threat is neutralized. Although US officials confirmed that the United States had no part in or responsibility for the attack, the event unsettled global markets and increased the demand for Treasuries. Earlier in the week, yields were already experiencing downward pressure due to growing uncertainties surrounding US trade policy, particularly after President Trump threatened to implement unilateral tariffs to advance new trade agreements. Furthermore, consumer and producer inflation data, which came in below expectations, heightened anticipations for further interest rate cuts by the Federal Reserve this year. Looking forward, market participants are turning their attention to the University of Michigan's consumer sentiment report for June.