Treasury yields rose on Monday after the U.S. and Mexico struck a trade deal, potentially removing a source of uncertainty from investors' minds.
The yield on the benchmark moved slightly higher to 2.844 percent, while the yield rose to 2.993 percent. The two-year note yield climbed to 2.645 percent. Bond yields move inversely to prices.
President Donald Trump said the deal would be called The United States-Mexico Trade agreement, leaving behind the 24-year-old NAFTA name. "The name NAFTA has a bad connotation because the ," he said. Trump added that the deal with Mexico is also very special for farmers and manufacturers. U.S. Trade Representative Robert Lighthizer said the deal must be approved by Congress before being implemented.
Officials were in Washington trying to work out the issues as the Trump administration pushes to remake the 1994 agreement with the U.S., Mexico and Canada. There was some hope that a new NAFTA could be solidified before Mexico's government turnover on Dec. 1.
Relations between the U.S. and Mexico have intensified in recent months as the U.S. has taken a more protectionist stance on trade. The U.S. has slapped tariffs on billions of dollars worth of Mexican imports; Mexico has retaliated with tariffs of its own.
At the Jackson Hole Symposium in Wyoming, Powell signaled the need for "further, gradual" interest rate hikes if the U.S. economy continues to strengthen. The Fed chief took a bullish view of the U.S. economy, saying it is "strong" and can handle more normalization of policy.
The Federal Open Market Committee (FOMC) has approved seven quarter-point rate rises in a cycle that began in December 2015. The central bank has hiked rates twice this year, and rate setters have indicated that two more are yet to come.