The yield on the US 10-year Treasury note held near 4.45% on Tuesday after sharp swings in the previous session, as investors assessed a stalemate in US–Iran peace efforts and looked ahead to key US labor market data. On Monday, Iranian media reported that Tehran had suspended communications with Washington in response to Israeli strikes in Lebanon. At the same time, President Donald Trump said talks were continuing and signaled that a memorandum of understanding with Iran to reopen the Strait of Hormuz could be finalized within the next week.
Rising energy-driven inflation has led markets to factor in the possibility of a Federal Reserve rate hike before year-end. Investors are now turning their attention to Tuesday’s JOLTS job openings report and, subsequently, to Friday’s closely watched US monthly employment data for further clues on the Fed’s policy path.