U.S. government debt prices posted declines on Tuesday.

The yield on the benchmark 10-year Treasury note was higher at around 2.873 percent at 5:40 a.m. ET, while the yield on the 30-year Treasury bond was in the black at 3.039 percent. Bond yields move inversely to prices.

Reopening after the Labor Day holiday, U.S. markets are largely attuned to developments surrounding trade friction.

Last week, the U.S. and Canada failed to secure an agreement to replace the current NAFTA pact by the Friday deadline. While a deal has been arranged with Mexico, President Donald Trump tweeted over the weekend that there was “no political necessity to keep Canada in the new NAFTA deal.”

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Trump added that Congress shouldn’t intervene in the talks, and claimed that if it did, he would “simply terminate NAFTA entirely.” Trade talks with Canada are however expected to reignite this week.

Also last week, a Bloomberg report suggested that the U.S. administration was on standby to inflict additional levies on $200 billion worth of Chinese goods as soon as this week. In an interview with the same media outlet, Trump warned that he would consider removing the U.S. from the World Trade Organization (WTO) if it doesn’t “shape up.”

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Investors are also keeping an eye on emerging markets. In Turkey, the lira has lost at least 40 percent of its value in 2018 over concerns surrounding President Recep Erdogan’s policies and the economy. And the Argentinian government asked the International Monetary Fund (IMF) for an early release of funds from the nation’s $50 billion standby financing deal — a move that surprised markets and put the peso under pressure.

In data news, manufacturing purchasing managers’ index (PMI) figures are due out at 9:45 a.m. ET, followed by ISM manufacturing data and construction spending, both due at 10 a.m. ET.

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The U.S. Treasury is scheduled to auction $48 billion in 13-week bills, $42 billion in 26-week bills and $55 billion in four-week bills. No size announcements are expected.

No speeches by the U.S. Federal Reserve are scheduled.

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