US, Australia Treasury Yields Fall on Weak Data, Trade Concerns

U.S. Treasury yields fell sharply following weaker-than-expected labor market data, including a private payroll increase far below estimates and contraction in the services sector, signaling potential economic slowdown. The 10-year Treasury yield dropped to its lowest level since early May, influenced by uncertainty over inflation and upcoming Federal Reserve decisions. President Donald Trump implemented a 50% tariff on steel imports, escalating trade tensions, particularly with China, where negotiations remain fraught amid accusations of violations on both sides. Markets are closely watching upcoming labor reports and economic data, alongside the Federal Reserve's Beige Book, to gauge the impact of tariffs and economic conditions on future monetary policy. Meanwhile, Australia’s 10-year bond yield also declined after softer GDP growth, reinforcing expectations of further rate cuts by the Reserve Bank of Australia due to economic risks from U.S. tariffs. Overall, trade policy developments and economic data continue to drive volatility and cautious sentiment in global bond markets.