Treasury yields flat as markets monitor economic reopening and civil unrest

U.S. government debt prices were little changed on Tuesday morning as investors assessed the reopening of economies against a backdrop of mass civil unrest.

At around 2:10 a.m. ET, the yield on the benchmark 10-year Treasury note was marginally lower at 0.6607% and the yield on the 30-year bond hovered just below the flatline at 1.4539%. Yields move inversely to prices.

Police used tear gas and rubber bullets on protesters outside the White House on Monday to clear a path for President Donald Trump to walk through Lafayette Square and pose for a picture outside St. John’s Church.

Meanwhile in a hastily-assembled Rose Garden address, Trump threatened to use military force to quash nationwide demonstrations sparked by the police killing of George Floyd, an unarmed black man, in Minneapolis last week. He did not address the issues of police brutality or racial inequality underlying the protests.

The unrest comes as states attempt to gradually reopen their economies following months of lockdowns due to the coronavirus pandemic, which has now infected more than 1.8 million Americans and killed more than 105,000, according to Johns Hopkins University.

Markets had taken heart from the prospects of reopening, but concerns about the duration and possible escalation of the protests following Trump’s remarks, along with rising tensions between the U.S. and China over its increased control in Hong Kong, will likely weigh on risk sentiment.

There are no major economic data releases scheduled for Tuesday.

Auctions will be held Tuesday for $40 billion of 119-day Treasury bills and $65 billion of 42-day bills.