FX.co ★ US 10-Year Yield Inches Lower

On Monday, the yield on the 10-year U.S. Treasury note settled at 4.43%, retreating from last week's climb which peaked above 4.5%. This adjustment comes as the market continues to evaluate the future of U.S. trade policy and its repercussions on economic growth and the demand for U.S. debt securities. The Presidential administration provided temporary relief by exempting consumer electronics and computers from a series of aggressive tariffs on China. This decision offered a momentary pause in the selloff of Treasuries, indicating that President Trump recognizes a limit to tariff increases and may impose restrictions if financing conditions become strained. Nevertheless, significant uncertainty lingers, as Trump has also cautioned that future tariffs on electronics and semiconductors remain on the table. The White House's fluctuating stance on tariff amounts led to earlier selloffs of U.S. Treasuries in April, highlighting investors' concerns regarding the security of U.S. debt, and contributing to a pronounced narrowing of swap spreads.