FX.co ★ US 10Y Yield Rises as US-Iran Talks Fail

The yield on the US 10-year Treasury note rose to around 4.35% on Monday, reversing last week’s decline as escalating tensions in the Middle East intensified inflationary pressures. President Donald Trump announced a blockade of the Strait of Hormuz after weekend peace talks between the US and Iran ended without an agreement. Vice President JD Vance departed Islamabad without securing a deal with Iranian officials, citing Tehran’s refusal to abandon its pursuit of nuclear weapons. At the same time, Iran reportedly demanded control over the Strait of Hormuz, war reparations, and the release of frozen assets. The effective shutdown of this critical shipping corridor has driven energy prices higher and amplified inflation risks, strengthening expectations that the Federal Reserve may postpone interest rate cuts or even consider additional rate hikes.