U.S. Treasury Yields Decline as Trump Predicts Quick End to Iran Conflict

U.S. Treasury yields fell on Wednesday following U.S. President Donald Trump's statement that the conflict with Iran could conclude within two to three weeks. According to Jin10, this development boosted U.S. bond prices, with the 2-year and 10-year Treasury yields dropping approximately 6 basis points to 3.73% and 4.26%, respectively. Market analysts speculate that a rapid de-escalation of tensions might clear the path for the Federal Reserve to resume interest rate cuts. Facing declining approval ratings, Trump is under pressure to avoid the economic risks of a prolonged conflict. Kenta Inoue, a senior fixed income strategist at Mitsubishi UFJ Morgan Stanley Securities, noted that as concerns over the energy crisis ease, the short end of the yield curve is expected to start pricing in rate cut expectations. Valentin Marinov, head of G-10 FX research at Crédit Agricole, observed that the U.S. dollar, previously a major beneficiary of the conflict, is now witnessing the unwinding of long positions.