NEW YORK: Longer-dated US Treasury yields edged lower on Monday as investors focused on Tuesday's retail sales figures as the next indicator of the strength of the US economy.

The US yield curve has steepened in the past week, led by higher longer-dated yields, as the US economic picture improves.

Data earlier this month showed that US job growth rebounded strongly in June while underlying consumer prices also gained by the most in nearly 1-1/2 years in the month.

"The question is whether we are going to get more of the same," said Subadra Rajappa, head of US rates strategy at Societe Generale in New York.

Data on Tuesday is expected to show that retail sales gained 0.1% in June, according to the median estimate of economists polled by Reuters.

The yield curve between two-year and 10-year notes has steepened to 26 basis points, from 15 basis points last Tuesday.

The Federal Reserve is expected to cut rates when it meets later this month, even as the US economic picture improves.

"They are concerned more about the slowdown in global growth" and inflation expectations, said Rajappa.

Records from the US central bank's latest meeting, released last week, showed increasing fear that a US-China trade war that has done little to directly restrain growth is indirectly causing businesses to hold back on buying equipment, giving workers a raise and hiking their prices.

A rate cut this month is seen as certain with interest rate futures traders pricing in a 72% chance of a 25 basis point cut and a 28% likelihood of a 50 basis point cut, according to the CME Group's FedWatch tool.