Iran optimism fades, leaving FX markets bracing for more turbulence
Good morning. Risk appetite is deteriorating across the financial system as the Middle East conflict shows little sign of easing ahead of President Trump’s deadline for resuming military strikes against Iranian power plants and energy infrastructure tomorrow. Although there are clear signs of political exhaustion in Washington, Iran yesterday rejected the administration’s maximalist overtures, and Axios is reporting that the Pentagon is preparing options for a major escalation, possibly including the deployment of ground forces. Brent crude is back above $107 a barrel, West Texas Intermediate is climbing through $94, and European natural gas futures are pushing higher as prospects...