Yields close unchanged on mixed peace deal news. Treasury yields dipped ~3 bps this morning following reports from Iran of a draft peace deal, though the move later reversed after the White House said to not believe Iranian media. Yields closed flat across the curve, with the 2-year yield at 4.03% and the 30-year yield at 5.01%. Equities ended the day largely unchanged, still hovering around all-time high levels, with the S&P 500 and NASDAQ up 0.02% and 0.07%, respectively. Meanwhile, WTI crude closed ~4.50% lower around $89 per barrel.
Trump dissatisfied with Iran negotiations. President Trump said today that Iran has not “gotten there” in peace agreement negotiations, though he added that both sides are “very much intent” on reaching a deal. His comments came after an Iranian state television report outlining a draft agreement that would require US forces to withdraw from the region and the Strait of Hormuz to reopen. The White House called the report a “complete fabrication,” and President Trump also denied that he would consider lifting sanctions on Tehran or allow Russia and China to remove Iran’s enriched uranium. Despite conflicting signals from both sides in recent weeks, each has also pointed to diplomatic progress.
Fed’s Cook open to rate hikes if inflation persists. Fed Governor Lisa Cook said she is ready to hike rates if inflation remains elevated, though she favors holding policy rates steady for now. Cook explained, “I want to be clear about my risk assessment: The risks remain tilted toward higher inflation.” Cook currently anticipates price pressures to cool in the coming months, but is prepared for rate hikes “if the expected disinflation does not appear in a timely manner.” Cook joins the list of Fed officials who see the possibility of a rate hike if the Iran war continues and energy prices keep upward pressure on inflation. Futures markets are currently pricing in a rate hike by the April 2027 FOMC meeting.
