Treasury Yields Climb as U.S.-Iran Peace Negotiations Stall

U.S. Treasury yields trended higher on Tuesday as geopolitical tensions escalated following a deadlock in peace negotiations between Washington and Tehran. The 10-year Treasury note, a global benchmark for borrowing costs, increased by more than 2 basis points to reach 4.356%. Short-term and long-term yields also rose, with the 2-year note hitting 3.822% and the 30-year bond reaching 4.960%. The market reaction follows reports that diplomatic efforts hit an impasse over the weekend. White House press secretary Karoline Leavitt confirmed that President Donald Trump and his national security team reviewed a proposal from Iran to reopen the Strait of Hormuz in exchange for the lifting of a U.S. blockade and an end to the two-month-old war. Under the reported proposal, negotiations regarding Iran's nuclear program would be deferred to a later date. However, President Trump has previously maintained that the blockade will remain in place until a comprehensive deal is finalized. This uncertainty has pushed oil prices higher as the risk of continued supply disruption persists. Beyond geopolitics, markets are focused on a series of critical central bank meetings. Federal Reserve Chair Jerome Powell is expected to maintain current interest rates during Wednesday's policy meeting. Similarly, the European Central Bank and the Bank of England are scheduled to announce decisions on Thursday, with expectations that both will hold rates steady while remaining open to future hikes to combat war-driven inflation.