US bond yields dropped sharply on Monday after President Donald Trump announced tariffs on Canada, Mexico, and China. The short-term 2-year Treasury yield rose, while the long-term 10- and 30-year rates plummeted to their lowest levels in over a year.
The Federal Reserve was expected to raise interest rates higher for longer due to the tariffs. However, investors now think that long-term growth is likely to slow down. The delay of Mexico’s tariffs has also added complexity to market assessments.
Despite the uncertainty, Monday’s closing yields showed some promise, with 10- and 30-year rates at their lowest levels since 2025.
Source: https://www.marketwatch.com/story/yield-curve-flattens-in-initial-reaction-to-trump-tariffs-08af5690