FX.co ★ US 10-Year Yield Rises on Iran Deal Uncertainty

The yield on the US 10-year Treasury note rose to about 4.47% on Monday, rebounding from three-week lows as uncertainty persisted over a longer-term ceasefire agreement between the US and Iran. Over the weekend, Washington and Tehran exchanged proposals seeking changes to a draft deal aimed at extending the ceasefire and reopening the Strait of Hormuz, but there were few indications of substantive progress in the negotiations. At the same time, investors shifted their focus to the closely watched US nonfarm payrolls report, which is expected to provide fresh insight into labor market conditions and the Federal Reserve’s policy outlook. Following a recent acceleration in inflation, markets have increasingly priced in the possibility of a Fed rate hike before year-end, marking a notable reversal from earlier expectations of interest rate cuts.