Treasuries declined as ongoing diplomatic efforts to help prevent the Israel-Hamas war from expanding into a wider conflict reduced demand for haven assets. Yields on the US 10-year benchmark climbed higher than 4.7%, while those on the 30-year rose more than four basis points, with the selloff steepening the yield curve further.
Gold fell for a second day, as did oil. US President Joe Biden is set to visit Israel as part of a push to prevent the war from spreading. Secretary of State Antony Blinken also returned to Israel to meet Prime Minister Benjamin Netanyahu, after talks with Arab governments.
Russian President Vladimir Putin held a call with the leaders of Egypt, Syria, Iran and the Palestinian Authority, and the Kremlin said there was a “unanimous opinion” on the need for a cease-fire. He spoke separately with Netanyahu.
“It seems that with the Middle East conflict in a holding pattern, bonds have lost the little bit of demand they garnered from last week’s safe-haven flows, sending yields inadvertently higher,” said Matthew Simpson, a senior market strategist at City Index.
Elsewhere, the dollar steadied after falling in the previous session, while the kiwi was the worst performer among Group-of-10 peers as the nation reported slower-than-expected inflation.
