Oil, yields rise on Trump’s Iran comments. Treasury yields jumped 10-15 bps across the curve today after President Trump downplayed the importance of an Iran deal. The 2-year yield (4.88%) and 10-year yield (5.13%) are up 34 bps and 27 bps, respectively, from Tuesday’s intraday lows, and sit within 5 bps and 20 bps of their YTD highs. Brent crude rose by over 3.4% today to nearly $96 following the comments after having hit multi-month lows of almost $92 on Monday. Meanwhile, equities closed slightly lower with Nvidia (-4.43%) leading declines following Jensen Huang’s resignation.
Iran deal optimism dwindles. President Trump said today that the US does not need an agreement with Iran, writing on Truth Social that “those days have long since passed.” He also asked Vice President JD Vance to turn his “complete and total attention” to domestic matters.The post follows a Wall Street Journal report that Vance was weighing a meeting with Mohsen Rezaei, a senior Iranian security official, to continue negotiations. Trump did not say whether indirect talks between US and Iranian officials through mediators would continue.
Fed officials stress inflation risks. Cleveland Fed President Beth Hammack, one of two dissenters at the October FOMC meeting, reiterated her preference for gradual rate hikes today with inflation “moving in the wrong direction.” San Francisco Fed President Mary Daly agreed and warned that inflation is elevated even in sectors that are not driven by tariffs or oil. That includes the services sector, where core inflation reached +0.4% in October. Chicago Fed President Austan Goolsbee called Tuesday’s CPI data “borderline disturbing” and added today, “We’re inching our way into a territory that’s historically a tough spot for any central bank to try to get rid of that inflation.” The next FOMC meeting is scheduled for December 8-9, where markets have fully priced in a 25 bp hike.