Construction continues on the Marriner S. Eccles Federal Reserve Building in Washington, DC on December 30, 2025.
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Treasury yields rose on Tuesday as investors await clarity on an expected second round of U.S.-Iran peace talks.
The yield on the 10-year US Treasury bonds Note – the main measure of U.S. government borrowing – rose more than 4 basis points to 4.299%.
The 2-year Treasury note The yield, which better reflects the Federal Reserve’s short-term interest rate policy, was more than 6 basis points higher at 3.783%. The longer dated 30-year government bond The yield rose more than 2 basis points to 4.908%.
One basis point is equal to 0.01%, and yields and prices move in opposite directions.
There was a flurry of mixed messages from both governments on Monday, as Iran held off committing to further negotiations in the face of the president’s threats of overwhelming military force Donald Trump.
On Tuesday, Iranian state media reported shortly before 4 a.m. ET that no delegation had yet left for planned peace talks in Islamabad.
“By imposing a siege and violating the ceasefire, Trump is attempting to turn this negotiating table – in his own mind – into a table of surrender or justify renewed warmongering,” Iranian Parliament Speaker Mohammad Bagher Ghalibaf said in an X post.
“We do not accept negotiations in the shadow of threats and have been preparing over the last two weeks to reveal new cards on the battlefield,” added Ghalibaf, who is also Iran’s chief negotiator.
This followed Trump’s statement that “a lot of bombs will explode” if an agreement is not reached before the shake-up armistice expires.
Investors are also uncertain about the exact expiry date of the ceasefire.
The two-week deal agreed between the US and Iran expires on Wednesday. Trump said Bloomberg On Monday, he announced that the ceasefire would end “Wednesday evening Washington time.”
Elsewhere, traders are watching the candidate for Federal Reserve chairman Kevin WarshThe confirmation hearing will take place on Tuesday. In his prepared statement to the Senate Banking Committee released Monday, the former Fed governor said the U.S. central bank needs to be largely independent of political influence while remaining focused on its core objectives.
“The Fed needs to stay in its lane,” he said. “The Fed’s independence is most at risk when it drifts into financial and social policy in which it has neither authority nor expertise.”
Trump also told CNBC that he would be disappointed if Warsh doesn’t cut interest rates immediately if he is appointed head of the central bank.
— CNBC’s Lisa Kailai Han and Justina Lee also contributed to this report.
