US government bond gains were wiped out by climbing European government bond yields following reports of potential new tariffs. Yields increased by approximately two basis points across various maturities in New York, reversing the earlier drop in the Treasury market. Support for Treasuries decreased as US stock benchmarks recovered, with the S&P 500 bouncing back. The bond and foreign exchange markets appear conflicting and uncertain until there is clarity on the tariffs situation. Treasury yields hit session lows despite a positive report on private-sector job growth in March.

Investors are on edge awaiting the tariffs announcement, speculated to include various proposals such as tiered tariff rates. The willingness of the US administration to negotiate could impact the final tariff percentages. Earlier yield decreases were influenced by China's actions to restrict local investments in the US, adding tension to the trade dynamics between the US and China under Trump's tariff policies.