10-year US Treasuries are set for their biggest monthly decline since Donald Trump took office, a drop that directly threatens his goal of lower interest rates and casts doubt on the administration's economic strategy as it grapples with an escalating energy crisis in Iran.

This sharp selloff reflects investor anxiety over potential disruptions to global oil supplies following heightened tensions between the US and Iran. Treasury Secretary Steven Mnuchin's department has struggled to maintain market confidence amid these geopolitical risks, which could force the Federal Reserve to reconsider its interest rate trajectory if yields rise significantly.

The market turmoil underscores the vulnerability of Trump's economic agenda to international conflicts. If sustained, this decline could pressure the Fed to delay planned rate hikes, though the administration's ability to manage the crisis remains uncertain as it faces domestic energy shortages and international diplomatic challenges.