US Treasury futures declined, and the yield curve continued to flatten. It is reported that the US is sending dozens of additional air tankers to Israel on the eve of a possible escalation of military action. The day's decline was mainly concentrated at the front end of the yield curve, driving the 2-year/10-year and 5-year/30-year treasury bond yield spreads to narrow by about 3 basis points and 2 basis points respectively, all hitting intraday lows. US 2-year Treasury yields rose about 2 basis points from Thursday's close, while long-term Treasury yields declined slightly. The overnight index swap linked to the Federal Reserve session shows that the market has taken into account the interest rate hike premium of about 4 basis points at the July meeting, which is basically the same as earlier in the day; the market expects a cumulative interest rate hike of about 30 basis points until December, higher than the 27 basis points estimated at the close of Thursday.

US Treasury futures declined, and the yield curve continued to flatten. It is reported that the US is sending dozens of additional air tankers to Israel on the eve of a possible escalation of military action. The day's decline was mainly concentrated at the front end of the yield curve, driving the 2-year/10-year and 5-year/30-year treasury bond yield spreads to narrow by about 3 basis points and 2 basis points respectively, all hitting intraday lows. US 2-year Treasury yields rose about 2 basis points from Thursday's close, while long-term Treasury yields declined slightly. The overnight index swap linked to the Federal Reserve session shows that the market has taken into account the interest rate hike premium of about 4 basis points at the July meeting, which is basically the same as earlier in the day; the market expects a cumulative interest rate hike of about 30 basis points until December, higher than the 27 basis points estimated at the close of Thursday.