U.S. and Iranian negotiators have reached a draft memorandum of understanding aimed at extending a ceasefire and initiating discussions regarding Iran’s nuclear program, though President Donald Trump hasn’t given his approval yet, according to a report from Axios.
The report follows U.S. airstrikes on Iranian military installations near the Strait of Hormuz—an essential route for energy transportation that has kept macro traders quite focused recently.
At this point, traders seem to have lost track of the numerous potential peace deals in the Middle East, yet they’re still actively trading stocks and bonds high, while oil prices are dropping based on the Axios news. After starting off sluggishly, the Nasdaq has climbed 0.6%, and WTI crude oil prices have dipped below $90 a barrel.
Meanwhile, the cryptocurrency market isn’t performing well, and Bitcoin has struggled to maintain any gains, dropping to below $73,000, a decrease of 2.7% within the last 24 hours.
In reaction to the Axios report, Treasury Secretary Scott Bessent stated that the U.S. would not allow any tolls on ships navigating through the Strait of Hormuz and threatened active sanctions against those interfering with commercial navigation in that critical area. He particularly noted that Oman should be aware that any parties facilitating such tolls would be targeted by the U.S. Treasury Department.
Fed-recommended inflation measure reaches highest level since 2023
In other news, the first inflation report under Federal Reserve Chairman Kevin Warsh indicated that upward price pressures have intensified in April, with the Fed’s preferred measure, the Personal Consumer Expenditure Index (PCE), climbing to 3.8% year over year—the highest rate in almost three years, up from 2.8% in February.
“The inflation situation is increasingly worrisome for the Fed,” remarked Olu Sonora, head of U.S. economics at Fitch Ratings. “It’s not only the headline inflation that’s a problem. Core inflation is also trending negatively. Price pressures are likely to linger for a while, and although the Fed can’t fix the supply shock, it can’t overlook the factors affecting underlying inflation. The Fed finds itself in a tight spot, and the pressure is unmistakably building.”
