President Donald Trump announced an end to the U.S. ceasefire with Iran following a week of military exchanges, though he said both sides have agreed to continue talks. The escalation has heightened geopolitical risk and pushed crude oil prices to their largest weekly gain in eight weeks.
President Donald Trump stated that the critical Strait of Hormuz is open to commercial traffic, aiming to quell market fears as the U.S. and Iran continue to exchange attacks in the region.
President Donald Trump announced an end to a month-old ceasefire with Iran, though he said talks would continue after a week of escalating military exchanges in the Gulf. The renewed tensions have pushed crude oil prices to their largest weekly gain in eight weeks.
Speculative bets against the Japanese yen are approaching two-year highs, while foreign investors turned net sellers of Japanese assets in June, according to Bank of America. The firm warns this stretched positioning creates risks of a sharp market reversal.
U.S. Treasury yields climbed as investors anticipated a hawkish tone in the Federal Reserve's upcoming June meeting minutes. European bond yields also rose amid improving investor sentiment in the region.
The Canadian dollar strengthened against the U.S. dollar, supported by a sharp rally in crude oil prices following heightened geopolitical tensions and increased bets on a Bank of Canada interest rate hike.
The British pound saw modest gains, but the dominant market theme was a stronger U.S. dollar, supported by a spike in oil prices following U.S. military action in Iraq which has bolstered hawkish Federal Reserve expectations.
Deutsche Bank strategists argue that interest rate differentials are the dominant force in currency markets this year, making carry trades attractive in a stable global economy.
U.S. Treasury and German Bund yields held steady on Friday, pausing a sharp sell-off sparked by military clashes between the U.S. and Iran. The conflict has disrupted oil supplies and revived market fears of a new inflationary shock.
