Treasury yields move lower as traders weigh U.S.-Iran tensions

Treasurys fell on Thursday after the previous session’s yield spike as traders weighed new economic data and sought to look beyond the renewed hostilities in the Middle East.

The key 10-year U.S. Treasury note yield — the main benchmark for mortgage borrowing, auto loans and credit card debt — was down more than 2 basis points at 4.545%.

The 2-year Treasury note yield, which is typically more sensitive to short-term Federal Reserve interest rate decisions, was down more than 3 basis points at 4.17%.

The longer-dated 30-year Treasury bond yield, which moves in line with broader geopolitical risks, dipped slightly but held above the key 5% level, at 5.057%.

One basis point is equal to 0.01%, and yields and prices move in opposite directions.

Yields have been on the rise this week as tensions between the U.S. and Iran ramped up once again, stoking fears of elevated inflation.

The U.S. carried out extensive strikes against Iranian military targets overnight, including air defenses, drone and missile sites. To be sure, President Donald Trump said Iran called Iran to make a deal after the attacks.

West Texas Intermediate crude futures lost about 2% to settle at $72.08 per barrel. Brent crude futures, the international benchmark, fell 2.2% to close at $76.30 per barrel.

Traders are also grappling with new Federal Reserve meeting minutes showing a central bank split on interest rate policy.

The latest weekly initial jobless claims data for the week ended July 4 recorded 215,000 benefits claims, below the 218,000 that economists polled by Dow Jones expected.