Analysts: If the situation in the Middle East thaws, US Treasury yields could fall to 4.2%.

Daiwa Securities strategist Shun Otani stated that if some form of solution is reached in the Middle East conflict, the yield on the 10-year US Treasury bond could fall from the current 4.30% to around 4.20%. Otani pointed out that once hostilities subside, market focus may shift to ensuring safe navigation in the Strait of Hormuz and repairing relations between Iran and the Gulf states, which deteriorated during the conflict. He believes that the meeting of foreign ministers from more than 40 countries regarding the situation in the strait, as well as reports of negotiations between Iran and Oman, can be seen as positive signs towards de-escalation. (Jinshi)