TREASURIES-Yields dive as investors seek shelter from latest Trump tariffs

SINGAPORE, April 3 (Reuters) - U.S. Treasury yields dived to multi-month lows on Thursday as investors poured into safe-havens and ramped up bets of more Federal Reserve rate cuts after U.S. President Donald Trump unleashed larger-than-expected tariffs on the world.

Trump on Wednesday unveiled a 10% minimum tariff on most goods imported into the United States, with much higher duties on products from dozens of countries, sending global stocks plunging, currencies in a whirlwind and bonds surging.

The benchmark 10-year U.S. Treasury yield US10YT=RR tumbled 15 basis points to a more than five-month low of 4.04% in the early Asian session and were last down at 4.072%.

Yields move inversely to prices.

The two-year Treasury yield US2YT=RR dropped to 3.815%, having slid as much as 14 bps to a six-month trough of 3.76%.

"Tailwinds are blowing very, very strongly behind Treasuries now - safe-haven flows, fears of a recession and trade war and more Fed rate cuts," said Tony Sycamore, a market analyst at IG.

"You're going to see a raft of banks now coming through and saying that the chances of a recession in the U.S. are significantly higher."

Goldman Sachs recently raised the probability of a U.S. recession to 35% from 20% and said it expects more rate cuts, while J.P. Morgan's chief economist previously saw about 40% chance of a recession in the world's largest economy this year.

Traders have priced in more aggressive Fed cuts, with those expectations gathering steam following Trump's latest round of reciprocal tariffs.

Fed funds futures now point to just over 80 bps worth of easing by December. 0#USDIRPR

"You can probably say June is close to a done deal now for the Fed, they aren't going to like what they see," said IG's Sycamore about a June rate cut.

Across the curve, the yield on the 30-year U.S. Treasury note US30YT=RR fell nearly 9 bps to 4.4628%, while the 20-year yield US20YT=RR declined nearly 10 bps to 4.4840%.

Thursday's moves in U.S. Treasuries mirrored that of its peers globally as investors flocked to safety assets after Trump's latest tariff move sparked a market rout, with bond prices from Japan to Europe clocking strong gains.

In Tokyo, the 10-year Japanese government bond (JGB) yield JP10YTN=JBTC fell more than 12 bps to 1.34%, while the five-year yield slid 9.5 bps to 0.98%. JP/

Meanwhile, German bund futures FGBLc1 rose 0.58% in early trade, while French OAT futures FOATc1 gained 0.5%.