U.S. Treasuries rallied on Monday, pushing yields lower, as investors likely unwound short positions amid uncertainty over the economic fallout from U.S. tariffs.
U.S. President Donald Trump is pushing for a minimum tariff of 15% to 20% in any trade deal with the European Union, the Financial Times reported on Friday, up from a 10% level that appeared to be a likely outcome in trade negotiations ahead of an August 1 U.S. tariff deadline.
Meanwhile, the European Union is exploring a broader set of possible counter-measures against the U.S. as prospects for an acceptable trade agreement with Washington fade, according to EU diplomats.
The likelihood of higher than anticipated tariffs, which economists largely see as a drag on the global economy, contributed to some demand for European and U.S. government bonds on Monday.
“There is a little bit of concern about tariffs and the August 1 tariff date, there’s at least some discussion…
