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Treasury yields increased across the curve on Monday, as domestic inflationary pressures returned to the spotlight and renewed Middle East tensions sent energy prices higher.
The yield on the 10-year U.S. Treasury note — the key benchmark for mortgages, auto loans and credit card debt — was up more than 3 basis points at 4.5741%.
The 2-year Treasury note yield, which is more sensitive to short-term Federal Reserve interest rate decisions, increased 2 basis points to reach 4.1868%.
The longer-dated 30-year Treasury bond yield, which typically reacts to geopolitical risks, was also 2 basis points higher at 5.0282%.
One basis point is equal to 0.01%, and yields and prices move in opposite directions.
The moves mark a continuation of rising bond yields seen on Friday following a stronger-than-expected May jobs report, which saw unemployment hold steady at 4.3% and nonfarm payrolls rise by 172,000.
That pointed to a resilient U.S. labor market, cooling traders’ expectations for rate cuts under new Federal Reserve chair Kevin Warsh, as attention pivots back toward inflation concerns.
President Donald Trump said that Warsh should “do whatever he wants” when it comes to the interest rate trajectory, but reiterated his desire for lower borrowing costs.
In an interview with NBC News’ “Meet the Press”, Trump said that “there’s no reason to raise interest rates” following what he described as a “great report”, adding that raising interest rates would “kill success.”
Meanwhile, energy prices jumped early Monday after Israel and Iran exchanged missile strikes for the first time since the April ceasefire took effect.
Brent crude, the international oil price benchmark, rose 4.3% to $97.14, while U.S. West Texas Intermediate futures were last seen 4.3% higher at $94.43.
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