U.S. Treasury yields eased slightly on Tuesday after spiking the previous session, as concerns about higher energy costs caused by the Middle East conflict continue to grip markets.
The yield on the 10-year Treasury note — a key barometer for U.S. government borrowing — was seen 2 basis points lower at 4.426%. The yield on the shorter-term 2-year Treasury note, which closely tracks interest rate decisions by the Federal Reserve, moved lower by more than 2 basis points to 3.94%.
The 30-year Treasury yield slipped more than 3 basis points to 4.993%.
One basis point equals 0.01%, and yields and prices move inversely to one another.
Traders continue to monitor how the ongoing geopolitical strife is shaping the economic picture in the U.S.
West Texas Intermediate futures dropped 3.9% to close at $102.27 per barrel on Tuesday, as skirmishes around the Strait of Hormuz and Iranian strikes on the United Arab Emirates threaten to unravel the precarious ceasefire agreement between the U.S. and Iran.
Investors were digesting fresh hiring data from the Bureau of Statistics for clearer insights into the somewhat muddy employment picture later.
The bureau's monthly Job Openings and Labor Turnover Survey (JOLTS), which tracks hiring demand and dynamics, showed job openings fall to 6.87 million in March, though that was above the 6.8 million that economists polled by Dow Jones had forecast.
Meanwhile, the Institute for Supply Management's services PMI for April was just below expectations. The index — a gauge of non-manufacturing business activity — stood at 53.6 for the month, while economists anticipated 54.
"Bond yields are lower but not so much on the relative strength of the economy from today's reports on home sales, job openings and the trade balance," said Chris Rupkey, chief economist at FWDBONDS.
"The focus remains on the war in the Middle East and right now crude oil prices are dropping as the renewed threat of attacks has not materialized despite the market's worries on Monday at the start of the week," he added.