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Treasury yields slip as Covid-19 cases continue to rise

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U.S. Treasury yields dipped on Tuesday as investors eyed coronavirus stimulus developments in Congress.

The yield on the benchmark 10-year Treasury note fell to 0.901%, while the yield on the 30-year Treasury bond pulled back to 1.66%. Yields move inversely to prices.

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Republican and Democratic leaders said on Monday that they are aiming to extend the government funding for another week, while lawmakers look to put together another coronavirus stimulus package.

The U.S. recorded a record seven-day average of coronavirus cases of more than 196,200 infections, according to a CNBC analysis of Johns Hopkins University data on Monday. This means the seven-day average caseload is on track to top 200,000 this week, if that trend holds.

The U.S. is also approaching a record-high level in the seven-day average number of deaths from Covid-19.

"In the interim, more fiscal aid and support is certainly required," wrote Gregory Faranello, head of U.S. rates trading at AmeriVet Securities. "However, the unwillingness for compromise on the part of Congress is going to result in more permanent damage to the economy (last actions in April)."

This latest spike in Covid-19 cases has led several states and cities to reimpose stricter social-distancing measures. New York Gov. Andrew Cuomo said Monday that New York City could lose indoor dining next week, adding that more severe restrictions would be imposed if hospitals reach a critical point.

"You can't overwhelm the hospital system," Cuomo said. "Overwhelming the hospital system means people die on a gurney in a hallway."

To be sure, the Food and Drug Administration said a vaccine developed by Pfizer and BioNTech provides some protection after the first dose. The FDA also said it found no safety concerns with the vaccine. The U.K. administered the first shots of the drug on Tuesday.

CNBC's Jacob Pramuk and Will Feuer contributed to this article.