FX.co ★ US 10-Year Yield Hits 16-Month High

The yield on the US 10-year Treasury note rose to around 4.63% on Monday, its highest level since January 2025, as mounting inflationary pressures linked to the Middle East conflict strengthened expectations of a Federal Reserve rate hike later this year. In the latest developments, President Donald Trump warned Iran to “get moving” or face consequences after leaving China without securing meaningful trade breakthroughs or tangible progress toward ending the conflict and reopening the Strait of Hormuz. US CPI and PPI data released last week showed that the energy price shock is feeding into broader inflation, leading traders to fully price out any Fed rate cuts this year and to increase the odds of a rate hike before year-end. Investors are now awaiting the upcoming FOMC meeting minutes and flash US PMI releases for further insight into the path of monetary policy and the broader economic outlook.