Bond Market Commentary

Over in bond land, Treasury yields are higher before the opening bell Tuesday following a reading of small business optimism declining as expected. Investors are awaiting additional news on tariffs and trade deals, along with today’s consumer credit data release for May. As of 6:45 AM ET, the yield on the 10-year note is rising three basis points (0.03%) to 4.41%, while the 30-year bond yield is also increasing three basis points (0.03%) to 4.95%. The yield on the two-year note, which is more sensitive to changes in monetary policy, is up one basis point (0.01%) to 3.90%.

Treasury yields were higher on Monday following the Trump administration announcing that increased tariffs are now set to go into effect on August 1. President Donald Trump also posted the tariff rates for several countries, including 25% on Japan and South Korea. The yield on the 10-year note was up three basis points (0.03%) to 4.38%, while the 30-year bond yield rose six basis points (0.06%) to 4.92%. The yield on the two-year note increased one basis point (0.01%) to 3.89%.

On the data front, the National Federation of Independent Business’s gauge of small business optimism decreased to 98.6 in June from the prior month’s 98.8. The Federal Reserve (Fed) Bank of New York will release their June Survey of Consumer Expectations, including a measure of inflation expectations. Consumer credit is expected to have expanded by $10.55 billion in May, lower than the prior month’s increase of $17.87 billion.

In the auction space, the U.S. Treasury is set to issue $50 billion in 52-week bills, $50 billion in six-week bills, and $58 billion in three-year notes.

The Bloomberg 30-day visible supply fell $1.976 billion to $14.472 billion on Monday, compared to the 12-month average of $13.841 billion.

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