- media@moneyinfocus.news
The yield on the US 10-year Treasury note moved lower on Monday, slipping below 4.59% as investors reacted to renewed signs of progress in negotiations between the United States and Iran.
Iranian media reports indicated that Washington may consider a temporary waiver of sanctions on Iranian oil exports while broader diplomatic discussions continue. Separate reports also suggested Tehran could accept a long-term freeze of its nuclear program, fueling cautious optimism across global markets.
Despite the decline in yields during Monday’s session, benchmark Treasury rates remained close to one-year highs as persistent inflation concerns continue to shape investor expectations for monetary policy.
Elevated oil prices remain a key factor supporting inflationary pressures globally, complicating efforts by central banks to begin easing interest rates. Market participants increasingly believe policymakers may need to maintain restrictive monetary conditions for longer than previously anticipated.
Recent US inflation data reinforced that narrative, prompting traders to scale back expectations for Federal Reserve rate cuts in 2026. Markets now broadly expect the Fed to keep the federal funds rate unchanged through the end of the year, while the implied probability of an additional 25-basis-point rate hike has climbed to approximately 40%.
The Treasury market is also closely watching upcoming Federal Open Market Committee (FOMC) meeting minutes and fresh US PMI data for additional signals on the strength of the economy and the future direction of interest rates.
Analysts note that any sustained easing in geopolitical tensions involving Iran could help stabilize energy markets and reduce some inflation pressures. However, uncertainty surrounding commodity prices, global growth, and monetary policy continues to support elevated bond yields and heightened volatility across financial markets.
