US Bonds Advance as Trump Delays on Tariffs, Oil Prices Fall

US government bond yields approached their lowest levels of the year after President Donald Trump refrained from immediately implementing tariffs and oil prices declined, easing inflation concerns.

Most yields remain lower by several basis points despite rebounding from session lows reached during Asian trading hours. The 10-year note’s is around 4.57% after falling nearly 10 basis points to 4.53%.

Trump so far has held off on China-specific tariffs while saying Mexico and Canada will face 25% levies from next month, which sent currencies from both countries tumbling over 1%. The volatility in markets is a glimpse of the months to come as the new administration rolls out policy changes. US bonds took a beating in the lead-up to Monday’s inauguration on fears sweeping tariffs and tax cuts would drive up inflation, and policy signals triggered wild swings in assets worldwide.

“Trump’s message on energy was strong as expected, which will be good for lower prices in the short term,” said Gregory Faranello, head of US rates trading and strategy for AmeriVet Securities. “In Trump 1.0 we had low overall energy prices and little inflation. In addition, the evidence of tariffs and inflation is not conclusive.”

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