Traders work on the floor of the New York Stock Exchange at the opening bell on Jan. 27, 2025.
The yield on the 10-year Treasury note was slightly higher on Monday as investors looked ahead to several key economic data points this week, including the latest consumer inflation numbers, and braced themselves for new tariff announcements.
The 10-year Treasury yield was up by nearly two basis points at 4.503, while the 2-year Treasury yield hovered below the flatline at 4.277%.
Yields and prices move in opposite directions, and one basis point equals 0.01%.
Investors are awaiting several economic releases this week, with the January inflation reading due out at 8:30 a.m. ET on Wednesday. That will offer insights into whether the Federal Reserve is inching closer to its goal of bringing down U.S. inflation to an annual rate of 2%, and will be followed by the January producer price index, which measures wholesale prices, and initial weekly jobless claims on Thursday, and January retail sales data on Friday.
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Fed Chair Jerome Powell is scheduled to testify before Congress on Tuesday and Wednesday, and investors will listen closely for clues about future monetary policy decisions.
Powell's testimony comes at a volatile time in Washington with President Trump favoring tariffs against U.S. trading partners and with mixed messages coming from the administration on its approach to the Fed.
The president told reporters on Sunday that the U.S. will impose 25% tariffs on all imported steel and aluminum, and said he would issue retaliatory tariffs on countries that tax U.S. imports.
Money Report
The comments came as Trump's formerly announced levies on China were set to go into effect overnight Sunday.
"Steep tariffs and heightened policy uncertainty could push businesses to increasingly adopt wait-and-see behaviors and pull back on hiring," said Lydia Boussour, senior economist at EY-Parthenon. "This could lead to a more severe job slowdown, weaker income and restrained consumer spending amidst much higher inflation," she added.
