US Treasury Yields Fall as Lower Oil Prices Ease Inflation Concerns

US Treasury prices rose and yields fell on Monday as oil prices dropped.

The move extended a strong month for government bonds, with longer-term yields falling most.

Signals from Washington and Tehran that they are open to talks helped push oil lower after months of conflict had disrupted Middle East energy supplies.

Cheaper oil can reduce inflation pressure, which may make further Federal Reserve rate hikes less likely.

The Fed kept its policy rate unchanged last week, after raising it in September for the first time since 2023.

Investors still expect possible rate increases, though expectations for how much the Fed may tighten have eased.

US officials are due to discuss the government’s borrowing strategy on Wednesday, including questions about future Treasury supply.