U.S. Treasury yields were relatively flat on Monday as investors considered the state of the U.S. economy and the government shutdown entering its fourth week.
The yield on the 10-year Treasury note rose less than 1 basis point to 4.011%. Two-year government bonds also rose less than 1 basis point to 3.47%. The yield on the 30-year bond was almost unchanged at 4.603%.
One basis point equals 0.01%, and yields and prices move in opposite directions.
The U.S. government shutdown has entered its fourth week as Republican and Democratic lawmakers repeatedly fail to reach a compromise on the federal budget. The government shutdown halted the publication of economic indicators, including regular reports such as the number of new weekly unemployment claims.
This week, the September CPI is scheduled to be released on Friday, providing insight into the health of the economy ahead of next week’s FOMC meeting.
“While investors do not appear optimistic for now, many economists have expressed concern that a prolonged shutdown could impact quarterly gross domestic product (GDP) growth,” Northern Trust Chief Investment Officer Katie Nixon said in a note to clients. “However, most agree that this is a temporary slowdown, likely to be followed by a period of catch-up.”
Meanwhile, investors are optimistic that the U.S.-China trade tensions are calming down, with the possibility of 100% additional tariffs on Chinese imports starting November 1 becoming less likely.
U.S. Treasury Secretary Scott Bessent said Friday that he plans to meet with Chinese Vice Premier He Lifeng in Malaysia this week to try to stop the U.S. from expanding tariffs on Chinese goods that President Donald Trump has argued are unsustainable.
