Yields Steepen After Soft Treasury Auction

• President Trump announced an extra 25% tariff on goods from India, citing its ongoing Russian oil imports. This follows last week’s 25% reciprocal tariff, taking the rate to the highest among the US’s major trading partners.
• US yields saw a mild curve steepening, with the front end lower and longer tenors higher after a soft $42bn 10‑year auction, which cleared at 4.255%. The 10‑year ended 3bps higher at 4.23%.
• Minneapolis Fed President Neel Kashkari said the Fed may need to cut rates soon to counter a slowing US economy, noting tariffs are a short‑term inflation risk compared to the labour market slowdown.
• Domestically, attention is on June’s Goods Trade Balance, forecast to rise to $3.7bn from $2.2bn, aided by a pullback in May’s import surge.