U.S. Treasury yields moved higher on Monday after the U.S. and China agreed to slash tariffs on each other’s goods, in a move welcomed by investors.
At 5:09 a.m. ET, the 10-year Treasury yield was up nearly 6 basis points to 4.433%, while the 2-year Treasury yield jumped 10 basis points to 3.996%
More from CNBC
China says it’s willing to cooperate with the U.S. on fentanyl
First Chinese freight ship goods hit with Trump’s 145%-plus tariffs arriving at U.S. ports
Elon Musk’s regulatory troubles have begun to melt away in Trump’s second term
One basis point is equal to 0.01% and yields and prices move in opposite directions.The U.S. and China negotiated a trade deal to lower tariffs, with both countries announcing on Monday the suspension of most levies implemented on each other’s imports.
Tariffs between both countries will come down from 125% to 10%, according to the terms of the deal. The U.S.′ 20% duties on Chinese imports relating to fentanyl are still in place, bringing total tariffs on China to 30% currently.
Previously U.S. tariffs on China stood at 145%, while China implemented 125% levies on U.S. goods.
“We had very productive talks and I believe that the venue, here in Lake Geneva, added great equanimity to what was a very positive process,” U.S. Treasury Secretary Scott Bessent said in a news conference, after holding talks in Switzerland with China’s trade representatives over the weekend.
“We have reached an agreement on a 90-day pause and substantially move down the tariff levels. Both sides on the reciprocal tariffs will move their tariffs down 115%,” Bessent said.
Investors will also be looking ahead to a batch of economic data this week, which will offer an outlook on how trade tensions have impacted the economy since U.S. President Donald Trump implemented “reciprocal” tariffs on global trade partners in early April.
Investors will parse through the consumer price index reading for April, due on Tuesday morning. They will also await the producer price index and retail sales data on Thursday.
