US Treasury yields fell to six-week lows on Monday as stocks fell, boosting demand for low-risk US government debt. Major stock indexes slid 2 percent as a slump in Apple shares battered the technology sector while conflicting signals over the state of play between the United States and China on their trade dispute kept investors on edge.
Benchmark 10-year notes gained 6/32 in price to yield 3.054 percent, the lowest since Oct. 3 and down from 3.074 percent on Friday. "The yields are lower today because of the stock market," said Lou Brien, a market strategist at DRW Trading in Chicago.
Comments by New York Fed President John Williams on Monday that the US central bank is pushing ahead with gradual rate-hike plans next month as it marches toward a more normal policy stance may have added pressure to stocks. Some investors questioned whether the Fed will be able to continue raising rates, possibly harming economic growth.
Williams' comments "probably helped push the stocks down to a new leg because the comments by Clarida last week, although hardly definitive, were adding a little bit more uncertainty to the path of policy," Brien said. Richard Clarida, the Fed's newly appointed vice chair, said on Friday that US interest rates are nearing Fed estimates of a neutral rate, which "makes sense." The bond market will be closed on Thursday for the Thanksgiving holiday, and will close early on Friday.