Oil rose in Asian trade Monday after Trump rejected Iran's proposal to reopen
the Strait of Hormuz, stoking inflation concerns and triggering a renewed US
Treasury sell-off. The 2‑year Treasury yield rose 5bps to 4.90% and the 10‑year
yield rose 4bps to 5.20%. Japanese and Australian sovereign bonds also sold off.
Yields had already surged to multi-year highs last week amid focus on recent Fed
remarks and decisions. Damian McCulloch, head of fixed-income research at
Westpac, said the Fed's sustained hawkish signals and oil holding above $100 a
barrel are key drivers of the bond weakness.
