FX.co ★ US 10-Year Yield Holds Near 6-Month Low

The yield on the US 10-year Treasury note remained steady around 4.02% on Thursday, reflecting its lowest levels since April. This is attributed to mounting US-China trade tensions, the ongoing US government shutdown, and anticipation of further Federal Reserve interest rate cuts. President Donald Trump acknowledged the continuation of a trade war with China. However, Treasury Secretary Bessent suggested that the truce might be extended beyond the initial three months if China postpones its plans for new export controls on rare earth minerals. Concurrently, the government shutdown entered its third week, resulting in delayed releases of essential economic data crucial for shaping monetary policy. Recently, Fed Chair Powell highlighted indications of a cooling labor market, bolstering expectations for a rate cut this month, another in December, and potentially three more next year.