Commerzbank Says Treasuries Continue Weakness as Oil Prices Keep Heading Up; US Dollar Is Supported

07:02 AM EDT, 09/29/2026 (MT Newswires) -- Brent crude prices returned to move upwards following the latest Middle East headlines, as efforts to resolve the US-Iran conflict showed no signs of progress, according to Commerzbank Research. Treasuries declined as the 10-year yield moved above the 5.25% threshold. Iran sees a "high chance" that the conflict could escalate after the US midterm elections in November, Commerzbank wrote. Bloomberg, citing a US official, reported that mediators are engaged in "positive and constructive discussions." President Donald Trump denied an Axios report that he had offered Iran sanctions relief, while Tehran rejected a Bloomberg report that it is "showing flexibility" on its nuclear position. Federal Reserve Governor Lisa Cook expects Artificial Intelligence-driven productivity gains to deliver "modest disinflation" over the next few years, the bank said. Richmond Fed President Thomas Barkin, meanwhile, said AI isn't immune to the impact of higher interest rates. The US dollar remained supported. In Europe, a high-level German government meeting on care reform concluded without a deal, Commerzbank added. Italy's Treasury plans to launch in the fourth quarter a new five-year BTP bond maturing in February 2032. Gross issuance is expected to total 350 billion to 360 billion euros in 2026. In Asia, Japanese Finance Minister Satsuki Katayama said the yen's undervaluation remains a concern and that authorities will engage with market participants on the bond market. Japanese government bonds outperformed following a strong 40-year auction. The Reserve Bank of Australia raised its cash rate by 25 basis points to 4.6%, in line with expectations, said Commerzbank.