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Brent nears $90 as inflation fears lift bond yields
The 30-year Treasury yield hit 5.28%, near its highest level in almost 20 years, as oil price gains and Middle East shipping risks weighed on risk sentiment.
U.S. Treasuries are trading under strain ahead of a major inflation report, with renewed energy-market tightening adding to pressure on yields, according to Reuters in its Morning Bid column. Brent crude is trading near $90 a barrel after rising 5% the prior day.
Oil markets are bracing for a prolonged standoff tied to negotiations around the Strait of Hormuz, with the outlet citing conflicting positions between the U.S. and Iran. Reuters said Tehran has demanded the U.S. lift sanctions, pay reparations, and allow it some control of Hormuz, while the White House has insisted on compensation by Iran and freeing all shipping lanes.
The report points to persistent inflation worries that could keep bond yields higher and weigh on stocks even as the second-quarter earnings season continues. The yield on the 30-year Treasury note was 5.28%, near its highest level in almost 20 years.
Reuters also highlighted forex pressure, noting the Japanese yen weakened past 159 per dollar on Monday and into Tuesday, with Tokyo markets closed for a holiday. The column linked the move to uncertainty over the Bank of Japan’s willingness to tighten enough to support the yen, and to broader concerns in U.S. bond markets about potential liquidation tied to a long-running Japanese dollar-selling campaign.
Latest closeWTI crude $82.30 ▲5.3%|Brent $87.85 ▲5.2%