NEW YORK, June 23 (Reuters) - Yields on U.S. Treasuries

fell on Monday morning after Federal Reserve vice-chair Michelle

Bowman said the first interest rate this year could come as soon

as July.

Yields were slightly lower on the session after the U.S.

bombed Iran's nuclear sites over the weekend, raising

geopolitical tensions, and extended their fall after Bowman's

comments.

Bowman, recently tapped by President Donald Trump to be the

central bank's top bank overseer, said Monday she is growing

more concerned with risks to the job market than with the

potential inflationary effects of tariffs.

U.S. 10-year Treasury yields fell after Bowman's comments

and were last down 6.1 basis points to 4.314%. The two-year

U.S. Treasury yield, which typically moves in step

with interest rate expectations, fell 6.4 basis points to

3.844%.

Markets are expecting the first interest rate cuts to come

later in the year, potentially beginning in September. The CME's

FedWatch tool still showed mid-morning that markets saw a 77%

chance of rates being held steady at the July meeting.