Treasury yields move lower as investors continue to monitor oil prices and look ahead to Fed interest rate decision

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2026-03-16 11:19:45

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U.S. Treasury yields moved lower to start the week as investors monitored oil prices amid the U.S.-Iran war and looked ahead to the Federal Reserve’s interest rate decision this week.

At 6:38 a.m. ET, the benchmark 10-year Treasury yield was 2 basis points lower to 4.259%, while the 30-year Treasury bond shed 1 basis point to yield 4.896%. The 2-year Treasury note yield was down 3 basis points, reaching 3.698%.

One basis point is equal to 0.01%, and yields and prices move in opposite directions.

Investors are monitoring elevated oil prices as the war between the U.S. and Iran entered its third week. West Texas Intermediate futures with April delivery were last down 1.4% to trade at $97.5 per barrel, while Brent Crude rose just 0.3% to trade at $103.37 per barrel. Elevated oil prices also risk increased inflation, which remains a point of concern for investors.

U.S. President Donald Trump said Sunday that other countries should help the U.S. secure the Strait of Hormuz, arguing the key shipping route benefits them more than it does Washington. However, no country has publicly announced plans to deploy warships to the strait.

Meanwhile, on the domestic front, investors are looking ahead to the Fed’s second monetary policy meeting of the year on Wednesday. Traders are currently pricing in a nearly 100% chance of interest rates remaining unchanged, according to the CME FedWatch Tool.

Deutsche Bank analysts said in a note on Monday that its economists are expecting an emphasis on “elevated geopolitical uncertainty” at the meeting.

“Then at the press conference, they think Chair Powell is likely to stress that recent events mainly transmit through financial conditions—particularly oil prices. For now, however, our economists think he’ll avoid signalling any meaningful shift in the near-term policy outlook,” the analysts added.

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