FX.co ★ Treasury Yields March Higher

The yield on the US 10-year Treasury note inched higher on Tuesday, nearing 4.37%—its highest level in about a week—as oil prices climbed amid mounting tensions between the US and Iran. President Trump warned that, unless his conditions, including the reopening of the Strait of Hormuz, are met by 8 p.m. Eastern Time, the US may target key Iranian infrastructure. He later escalated his rhetoric, declaring that “a whole civilization will die tonight” if Iran’s leadership does not agree to a deal that includes reopening the Strait. At the same time, reports indicated that Iran has suspended negotiation efforts with the US.

On the economic front, consumer inflation expectations rose in March, while the logistics sector saw a marked increase in transportation costs. Looking ahead, the release of US March CPI data on Friday is expected to offer further insight into inflationary pressures that may be tied to the ongoing conflict.