Geopolitical tensions ease after US delays military action against Iran, lifting the Euro and pressuring the US Dollar.
The Euro rose 0.26% against the US Dollar to 1.1654, recovering from session lows of 1.1608. The move followed President Trump’s announcement delaying a planned strike on Iran, easing geopolitical risks and weakening the Dollar broadly.
US Treasury yields dipped slightly, with the 10-year note down 1 basis point to 4.585%. Earlier, hawkish Fed commentary and inflation data had fueled expectations of prolonged higher rates, pushing yields higher last week. Markets now price a 50% chance of a Fed rate hike by late 2026.
Oil prices remained volatile, with WTI crude up over 1% as headlines swung between escalation and de-escalation. Chicago Fed President Austan Goolsbee reiterated concerns over persistent inflation, reinforcing caution ahead of Kevin Warsh’s swearing-in as Fed Chair this Friday.