FX.co ★ US 10-Year Yield Steady as Fed Outlook Mulled

The yield on the US 10-year Treasury note steadied at approximately 4.2% on Monday following a tumultuous week, as investors assessed the Federal Reserve's policy stance against the backdrop of escalating geopolitical tensions and continued trade uncertainties. Over the weekend, the intensifying conflict between Israel and Iran took center stage, with both nations targeting energy infrastructure, resulting in rising oil prices. These circumstances are likely to diminish the probability of imminent rate cuts by the Federal Reserve, which is expected to maintain current interest rates at its upcoming meeting on Wednesday. Market forecasts indicate no likelihood of a reduction in rates come July, as policymakers contend with a challenging environment characterized by heightened energy costs, ambiguity in trade policies, and geopolitical unrest. Moreover, investors are anticipating Monday's manufacturing data, Tuesday's retail sales figures, and Wednesday's weekly jobless claims for additional insights into the Fed’s future actions.