Treasury yields were lower on Tuesday as investors brace themselves for U.S. President Donald Trump’s tariff policy rollout.
The yield on the 10-year Treasury lost 5 basis points to 4.194%. The 2-year Treasury yield ticked down over 2 basis points lower at 3.885%.
One basis point equals 0.01%, and yields and prices move in opposite directions.
Traders are eagerly awaiting more clarity on April 2, when many of Trump’s duties are set to come into effect.
Investors are optimistic that once the tariffs are implemented, some of the ambiguity surrounding U.S. trade policy could ease, providing more clarity on how the measures will unfold.
Investors are looking toward a data-heavy week. February’s JOLTS job openings report is due later in the day, ADP’s private payroll numbers for March is slated for Wednesday, and closely watched March employment data in the form of nonfarm payrolls and the unemployment rate is due Friday.
“Some on Wall Street are already talking about how ‘2 April’ may very well be lighter-than-feared, producing a snap-back rally in risk assets,” said José Torres, senior economist at Interactive Brokers.
“But others worry that this economy can’t handle a stress test of this magnitude and point to households increasingly unable to sustain expenditure patterns in light of mounting headwinds,” he wrote in a note.
Worries are mounting that the upcoming tariffs could trigger a sharp economic downturn, potentially leading to a recession. Economists surveyed by CNBC now project first-quarter growth at just 0.3%, a drop from the 2.3% seen in the fourth quarter of 2024.