Treasury yields slide after retail sales tumbled in May, raising recession fears

The yields of the US Treasury fell on Tuesday after retail sales were narrowed than what Wall Street economists expected, the lifting of bond prices and the concern that the economy is heading for a slowdown or even a recession.

The yield on the reference Treasury note at 10 years old fell from more than 6 base points to 4.387%, while the Treasury of 2 years The yield was more than 2 base points at 3.946%.

A basic point is equivalent to 0.01%, and bond yields and prices change inversely, which means that prices are higher on Tuesday.

Retail sales dropped by 0.9% in May according to the census office, worse than the 0.6% contraction which had been estimated by the economists interviewed by Dow Jones. Excluding automobiles, sales last month decreased by 0.3%, underperforming street waiting for an increase of 0.1%. Sales of gas stations have slipped by 2% during the month, which can reflect both lower prices but perhaps a slower economic activity.

The bond market also launched the early departure of President Donald Trump compared to the Summit of the Group of Seven, reporting a possible escalation in the Israeli-Iranian conflict. Trump said his early release was due to “much more important” events in the Middle East, while calling the Iranians to “immediately evacuate Tehran” in anticipation of the Israeli bombing.

“Indeed, there was no sign of de -escalation in the air war, with explosions of explosions in Tehran overnight, while Iran launched more missiles in Israel,” wrote Deutsche Bank in a note published on Tuesday. “There are still big questions as to if Israel would be receptive to a ceasefire, since he seeks to destroy the Iranian nuclear program,” said the bank.

The conflict between Israel and Iran entered a fifth day on Tuesday without any sign of less attacks. The two nations have issued new evacuation orders such as The missiles continued to rain.

Without Trump, the other six leaders of the seven group Conclude their summit in Alberta, Canada Tuesday without a joint press release expected at the end of the rally.