The 10-year Treasury yield pulled back on Monday as investors readied for President Donald Trump’s tariffs on Canada and Mexico to go into effect.
The benchmark 10-year Treasury yield slid more than 6 basis points to 4.163%. The 2-year Treasury yield slipped around 4 basis points, siting at 3.96%.
One basis point is equal to 0.01%, and yields and prices move in opposite directions.
Trump’s tariff plans are again in focus this week, with 25% duties on imports from Canada and Mexico slated to go into effect Tuesday. Trump confirmed the taxes were coming on Monday, hampering investors’ hopes for a last-minute deal that would avert the full levies getting slapped on key trading partners.
“They’re all set. They go into effect tomorrow,” Trump said on Monday.
He also said there was “no room left for Mexico or for Canada.”
Traders have expressed concerns about the effects of tariffs on the economy, with legendary investor Warren Buffett making a rare comment against Trump’s policies over the weekend. Buffett, the chairman and CEO of Berkshire Hathaway, said tariffs are “an act of war, to some degree” and could trigger inflation and hurt consumers.
“Over time, they are a tax on goods. I mean, the Tooth Fairy doesn’t pay ’em!” Buffett said. “And then what? You always have to ask that question in economics. You always say, ‘And then what?'”
Elsewhere, investors parsed economic data on manufacturing and construction that came in softer than economists predicted.
