US Treasury yields edged up on Tuesday as oil prices slipped following the U.S. pause in a nearly two-week campaign of strikes against Iran. The pause came after the Treasury Department announced that the sanctions campaign had been temporarily suspended while negotiations continued. Investors noted that the market is still watching the Federal Reserve’s upcoming decision, with a roughly one-in-three chance of a rate hike on Wednesday. The move in Treasury yields reflects a shift in risk sentiment as oil prices decline, reducing inflation worries. Analysts say that the pause in Iran strikes could ease geopolitical tensions, but the Fed’s policy stance remains a key focus, with markets uncertain whether the central bank will keep rates unchanged or adjust them to manage economic growth and inflation.

The decline in oil prices also supports the broader equity market, as lower energy costs tend to boost corporate earnings. Meanwhile, the Treasury market remains sensitive to any changes in U.S. monetary policy. The Fed’s meeting is expected to provide guidance on future policy, and traders are closely monitoring the minutes and speeches for clues. The Treasury yields have been volatile, swinging between 1.6% and 2.2% in recent weeks, reflecting the interplay between global events and domestic policy. The pause in Iran sanctions may also lift some pressure on the currency market, potentially strengthening the dollar. However, any abrupt change in the geopolitical landscape could quickly reverse gains.