The yield on the US 10-year Treasury note climbed to around 4.35% on Tuesday, rising for a second consecutive session as President Trump’s threat to intensify attacks on Iran outweighed optimism over ceasefire negotiations. Trump warned that the US could target Iranian power plants and bridges unless his conditions — including the reopening of the Strait of Hormuz — are met by 8 p.m. Eastern Time, though he emphasized that talks with Tehran are continuing and making progress.
On Monday, reports indicated that the US, Iran, and regional intermediaries are working toward a possible 45-day ceasefire and that a growing number of vessels are transiting the Strait of Hormuz. Against this backdrop, investors are now focused on Tuesday’s release of US durable goods orders, as well as upcoming inflation data and the latest FOMC minutes later in the week, for further insight into the economic outlook. Markets have fully priced in the Federal Reserve leaving the federal funds rate unchanged later this month, and borrowing costs are expected to remain on hold for the rest of the year.
