The yield on the 10-year US Treasury note fell to 4.46%, extending the drop from the 16-month high of 4.7% touched on May 20th as reports of an interim deal between the US and Iran limited the inflationary outlook. The US and Iran reportedly agreed to a 60-day memorandum of understanding that extends the current ceasefire and gradually restores the flow of tankers and commercial vessels through the Strait of Hormuz. Energy prices pared their rebound, easing inflationary concerns despite new data consolidating the surge in prices. PCE inflation rose to a 3-year high of 3.8% in April, while consumer spending remained relatively robust and jobless claims maintained their low level. Hawkish remarks by FOMC members also prevented a further drop in yields. Fed Vice Chair Jefferson warned that inflation risks remain tilted to the upside, while Minneapolis Fed President Kashkari said consumer prices are still “much too high”.