Treasury yields fall on report Chinese tariffs are likely to stay until after election

Treasury yields dipped on Tuesday after Bloomberg News reported the existing tariffs on Chinese goods would stay for longer.

The yield the benchmark 10-year Treasury note, which moves inversely to price, fell three basis points to 1.818%, while the yield on the 30-year Treasury bond was also lower at around 2.277%.

Bloomberg News reported Tuesday that despite the deal signing, the existing tariffs on billions of dollars of Chinese goods are likely to stay in place until after the presidential election.

The news came before the U.S. and China are set to ratify their so-called "phase one" trade deal on Wednesday.

Ahead of the preliminary agreement, the U.S. Treasury announced on Monday that it had dropped China's designation as a currency manipulator.

The decision comes more than five months after the Treasury Department formally made the designation, with Beijing now on a "monitoring list" for currency practices along with nine other countries, including Germany, Italy and Japan.

The fourth-quarter earnings season began with big banks reporting. J.P. Morgan Chase posted quarterly earnings and revenue that beat analyst expectations, while also reporting a surge in bond-trading revenues. Citigroup's quarterly results also topped expectations. Wells Fargo's numbers came in below estimates, however.

Yields extended their losses after the Labor Department said U.S. consumer prices rose slightly in December, which could allow the Federal Reserve to keep interest rates unchanged at least through this year.

The consumer price index increased 0.2% last month after climbing 0.3% in November. Economists polled by Reuters had forecast the CPI would rise 0.3% in December. Excluding the volatile food and energy components, the CPI edged up 0.1% after gaining 0.2% in November.

There are no major U.S. Treasury auctions scheduled on Tuesday.