US 10-Year Yield Rises as Traders Eye PCE Data

The yield on the 10-year US Treasury note climbed to around 4.3% on Tuesday, extending gains for a second straight session as investors awaited the release of the PCE price index later this week, the Federal Reserve’s preferred measure of inflation. The economic calendar for Tuesday also includes durable goods orders, consumer confidence, the Case-Shiller Home Price Index, and the Richmond Fed Manufacturing Index. Political developments added to market volatility after President Donald Trump announced the removal of Federal Reserve Governor Lisa Cook over alleged mortgage fraud. The move heightened concerns about the Fed’s independence and its ability to set monetary policy free from political interference. Analysts suggested that Cook’s dismissal could increase the chances of earlier interest rate cuts, given Trump’s persistent pressure on the Fed to ease borrowing costs. Futures markets currently imply an 83% probability of a 25 basis point rate cut at the September meeting.