Market Brief, North America

Good morning. Financial markets are rallying on hopes for a renewal of diplomatic engagement in the Middle East, with some media outlets reporting that US and Iranian negotiating teams could return to Islamabad for talks later this week. Oil prices are retreating, Treasury yields are coming under renewed pressure, equity markets are setting up for a positive open, and most major foreign exchange pairs are trading at or above key technical levels against the dollar. The euro is flirting with 1.18, the pound is holding above 1.35, the Canadian dollar is back in the 1.37s, and even the yen is...

Headline consumer price growth jumped by the most since June 2022 in the United States last month while measures of underlying pressure remained tame, underscoring the challenge facing the Federal Reserve as it struggles to balance labour market vulnerabilities against war- and tariff-related inflation risks. According to data published by the Bureau of Labor Statistics this morning, the all-items consumer price index rose 0.9 percent in March from the prior month, and 3.3 percent over the same period last year. This matched consensus estimates among economists polled by the major data providers ahead of the release, with a 20.2-percent jump...

Markets are giving back some of yesterday’s gains as doubts mount over Tuesday’s US-Iran ceasefire agreement, with Israel pressing its assault on targets in Lebanon, Tehran showing no sign of easing its grip on the Strait of Hormuz, and all sides remaining far apart on basic terms. Both the Brent and West Texas Intermediate global crude oil benchmarks are knocking on the $100 threshold once again, front-end Treasury yields are pushing higher, equity futures are pointing to losses, and the dollar is back to outperforming its higher-beta and carry-driven counterparts. There’s little evidence to suggest that the agreement is translating...