• Sentiment bolstered after US President Trump announced a ceasefire agreement between Iran and Israel, effective 05:00 BST / 00:00 EDT.
• Though Israel claimed Iran had launched ballistic missiles and violated the agreement, which Iran has denied.
• USD softer as geopolitical premium recedes, attention now turns to Fed Chair Powell who testifies before the House.
• Bonds hold a bearish bias given latest Iran-Israel ceasefire; USTs are lower by a handful of ticks whilst Bunds are hit on updates via the German Finance Ministry.
• Crude clipped by the ceasefire, XAU loses its shine, base metals find a floor.
• Looking ahead, Canadian Inflation, US Consumer Confidence, NZ Trade, NATO Summit, NBH Policy Announcement, BoE’s Bailey, Ramsden, Pill, Breeden; ECB’s Lagarde, de Guindos, Lane; Fed’s Powell, Hammack, Williams, Collins, Barr, Supply from the US, Earnings from FedEx, Carnival.

IRAN-ISRAEL

Note, this is a brief summary given the extensive amount of newsflow. Please see the bottom of the sheet for a full recap.

• US President Trump announced that Israel and Iran agreed to a complete and total ceasefire, from 05:00BST/00:00ET, which would last for 12 hours. After which, the war would be considered officially ended.
• Under the ceasefire announced by Trump, Iran would stop striking Israel in six hours (at midnight ET on Tuesday), and Israel is expected to stop striking Iran 12 hours after that (at noon ET Tuesday). Then, after another 12 hours, or at midnight ET Wednesday, the war will be considered over, a White House official confirmed to CBS News.
• Strikes continued into and after the Iranian proposed time of 01:30BST/20:30ET. After the Trump deadline of 05:00BST/00:00ET, Iran is said to have fired some missiles at Israel, though they claim it was fired just before the deadline.
• At 06:04BST/01:04ET Trump posted that the "ceasefire is now in effect".
• At 07:17BST/02:17ET Israeli PM Netanyahu confirmed the ceasefire is now in effect, war achieved its goals, will respond forcefully to any violations. PM's office adds that Netanyahu will deliver a statement later today.
• The ceasefire agreement seems to have broken down only 4 hours after being in effect, with the IDF suggesting it had detected and intercepted fresh ballistic missiles from Iran. In response to this latest attack, the IDF Minister instructed the military to respond “forcefully” to Iran’s violation of the ceasefire. Iran has denied firing missiles at Israel after the ceasefire.

TRADE/TARIFFS

• Japanese Economy Minister Akazawa is reportedly arranging to visit the US as early as June 26th for tariff talks, according to Yomiuri.
• The EU said it would not give up decision‑making power for a US trade deal, according to the WSJ citing European Commission President von der Leyen.
• US and South Korean trade ministers reaffirmed commitment to reaching a tariff deal early, according to the South Korean ministry.

EUROPEAN TRADE

EQUITIES

• European bourses (STOXX 600 +1.2%) opened entirely in the green and still trade at elevated levels, albeit have cooled a touch off peaks. Sentiment today has been boosted by US President Trump’s “complete and total ceasefire” announcement between Iran and Israel. Though this seems to have broken down only 4 hours after being in effect, with the IDF suggesting it had detected and intercepted fresh ballistic missiles from Iran. In response to this latest attack, the IDF Minister instructed the military to respond “forcefully” to Iran’s violation of the ceasefire. Iran has denied firing missiles at Israel after the ceasefire. Complex continues to remain buoyed.
• European sectors hold a strong positive bias, in-fitting with the positive risk-tone seen across markets. It comes as no surprise that Energy sits right at the foot of the pile, due to the latest slump in oil prices, following the latest ceasefire agreement. Travel & Leisure takes the top spot, lifted by lower oil prices and with airliners generally buoyed by the broader sentiment.
• US equity futures (ES +1% NQ +1.2% RTY +1.2%) are broadly in the green, with the complex boosted by the Iran-Israel ceasefire agreement; contracts are off worst levels however, amid commentary from the Israel side that Iran has already violated the agreement. A slew of Fed speak today, including the Fed Chair Powell who is to testify before the House.
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FX

• DXY is lower as the safe-haven premium continues to unwind for the USD. This comes after US President Trump declared a ceasefire between Iran and Israel; which was subsequently later acknowledged by Israel. However, Israel has since stated that Iran has breached the ceasefire. Accordingly, DXY has bounced from a 97.96 low and made its way back onto a 98.0 handle. Focus will be on Fed Chair Powell at 15:00 BST / 10:00 EDT alongside US Consumer Confidence.
• EUR is firmer vs. the USD but to a lesser extent than peers. EUR/USD rose to a session peak at 1.1622, benefiting from the Iran-Israel ceasefire, but the move for the Single-Currency ran out of steam around the same time that Israel claimed that Iran had violated the ceasefire. In terms of domestic drivers, German IFO data saw a larger-than-expected increase for the Business climate metric. A slew of ECB speakers are due throughout the day. If upside in EUR/USD resumes, the YTD high from June 12th sits at 1.1631.
• JPY is towards the top of the G10 leaderboard despite the unwind in the safe-haven premium seen elsewhere. JPY is instead benefitting from the pullback in oil prices, given that it is a net importer. Furthermore, Japanese Economy Minister Akazawa is reportedly arranging to visit the US as early as June 26th for tariff talks, according to Yomiuri. USD/JPY has pulled back markedly from Monday's 148.03 peak and briefly slipped onto a 144 handle with a current session low at 144.95.
• GBP is firmer vs. the USD and EUR as it benefits from the bump in risk sentiment. Fresh UK-specific macro drivers are lacking for today's session. However, that could change given the busy BoE speaker slate which includes MPC members Bailey, Greene, Ramsden, Pill and Breeden. Markets will be looking for any clues over the MPC's future easing intentions given the three dovish dissenters at last week's meeting, as well as a recent run of soft data points, including last week's retail sales release.
• Antipodeans are both are near the top of the G10 leaderboard on account of the positive risk-tone. Fresh macro drivers for both have been on the light side. However, traders are mindful of Australian monthly CPI metrics overnight, which are expected to see the Weighted Y/Y CPI metric decline to 2.3% from 2.4%.
• CAD firmer vs. the USD but to a lesser extent than peers as the declines in oil prices caps gains for the currency. Attention today will be on domestic inflation data with Y/Y CPI for May set to hold steady at 1.7%, M/M is expected to rise to 0.5% from -0.1%. Note, at its most recent meeting (where it left rates unchanged), the Bank stated that further rate cuts may be warranted if tariff-related uncertainty spreads but inflationary cost pressures remain contained.
• PBoC sets USD/CNY mid-point at 7.1656 vs exp. 7.1605 (prev. 7.1710); strongest CNY fix since Nov 8th 2024
• Brazil’s central bank announced a spot dollar auction for 25 June, offering up to USD 1bln. It also announced a reverse FX swap auction on the same date, offering up to 20k contracts, according to a statement.
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FIXED INCOME

• USTs are lower by a handful ticks in what has been a choppy European morning so far. Overnight, benchmarks lost their haven allure given Trump's Iran-Israel ceasefire agreement. Though this was short-lived, as Israel claimed Iran had broken the agreement by launching two missiles into the area - This sparked a modest bid in the USTs, taking it to 111-14. Pressure has since resumed more recently in tandem with Bunds, after the latest updates from the German Finance Agency (details below); USTs are currently trading just of lows at around 111-09+. For the US specifically, traders will eye US Consumer Confidence, 2yr supply and a slew of Fed speakers (incl. Fed Chair Powell).
• Bunds tracked peers overnight and into the morning, on the aforementioned geopolitical updates. For the region itself, the German Finance Ministry said it is to issue EUR 19bln more than initially planned in Q3. Thereafter, the agency said it will "probably" continue upward adjustments to bond issuance in Q4; commentary which saw German paper slip to a fresh trough of 130.35. On the data front, German Ifo printed firmer than the prior across the board. German auction was okay, with decent demand but with a higher avg. yield - ultimately unable to stop the continued pressure in Bunds, which is now down to a 130.35 low. Ahead, a slew of ECB speakers.
• Gilts are softer and trading marginally heavier than peers, potentially as a function of confirmation that the UK will pledge to increase defence spending to 3.5% (prev. 2.3%) by 2035. In slight contrast to Bunds and USTs, Gilts have exactly matched Monday’s 92.25-93.21 confines, but are yet to breach them. A couple BoE speakers have already appeared today (and a few more still yet to come); BoE's Greene said underlying activity is weak and the labour market has loosened further and the disinflationary process is continuing.
• Germany sells EUR 3.066bln vs exp. EUR 4bln 1.70% 2027 Schatz: b/c 2.9x (prev 2.9x), average yield 1.85% (prev 1.78%), retention 23.35% (prev 18.27%)
• UK sells GBP 1.7bln 1.125% 2035 I/L Gilt: b/c 3.02x (prev. 3.36x) & real yield 1.386% (prev. 1.268%)
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COMMODITIES

• Crude drilled lower overnight after the announcement of an Israel-Iran ceasefire which came into effect at 05:00 BST. Benchmarks now trade lower by around -3.5%, with recent two-way action seen on reports of ceasefire violations. In an update which lifted benchmarks this morning, the IDF said that it had detected missiles launched from Iran, which the nation said it had intercepted. Far-Right Israeli Finance Minister, Smotrich said the ceasefire was violated, and that Tehran will tremble in response. More recently, downticks were seen across the complex after Iran denied firing missiles towards Israel, we now look for further clarity. Brent Aug'25 currently trades around USD 69.30/bbl.
• Spot gold is firmly in the red, towards session lows and suffering from the positive mood after the US announced an Israel-Iran ceasefire.
• Base metals are trading firmer given the positive risk environment, alongside the softer USD.
• Kazakhstan's Tengiz oil output seen at 35.7mln T in 2025, according to KazMunayGas.
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NOTABLE DATA RECAP

• German Ifo Curr Conditions New (Jun) 86.2 vs. Exp. 86.5 (Prev. 86.1); Ifo Business Climate New (Jun) 88.4 vs. Exp. 88.3 (Prev. 87.5); Ifo Expectations New (Jun) 90.7 vs. Exp. 90 (Prev. 88.9)
• UK CBI Trends - Orders (Jun) -33.0 vs. Exp. -27.0 (Prev. -30.0)

NOTABLE EUROPEAN HEADLINES

• ECB’s Villeroy said the ECB could still proceed with rate cuts despite volatility in oil markets, according to the FT. He noted that inflation expectations remained moderate.
• BoE's Greene says underlying activity is weak, the labour market has loosened further and the disinflationary process is continuing. Worries about both demand and supply sides of the economy. Continue to think risks remain two sided but skewed to the downside on growth and to the upside on inflation. Given the period of elevated inflation through which we have just come, I think price stability is the key priority. A careful and gradual approach to removing monetary policy restrictiveness continues to be warranted. On the domestic front, noisy data means that it will take longer for me to take comfort from recent disinflationary trends. On the global front, there are a number of key events playing out between now and our next meeting, including the deadline for the pause on so-called “reciprocal tariffs” from the US, the potential passage of a budget in the US and the unfolding of events in the Middle East. It’s unlikely that the uncertainty from these events – and subsequent developments – will be resolved any time soon (in reference to global points of uncertainty, i.e. tariffs, geopols). Still expect trade policy to have a net disinflationary impact on the UK, but it may be muted relative to my expectations in May, when it was a factor in my decision to cut Bank Rate. The risk that our near-term plateau in inflation feeds through into second round effects is skewed to the upside.
• UK Grocery Inflation 4.7% in the four weeks to June 15th (prev. 4.1% in May), via Kantar; "Grocery footfall hit a five-year high", grocery volumes -0.4% Y/Y, the first such decline in 2025.
• German Finance Ministry says it is to issue EUR 19bln more than initially planned in Q3; includes EUR 15bln increase in borrowing on the capital market and EUR 4bln increase on the money market.
• German Finance Agency says will "probably" continue upward adjustments to bond issuance in Q4. Very good demand for long term bonds. 50yr Bond not planned for this year but internal conditions have been created.

NOTABLE US HEADLINES

• Fed's Bostic sees economic growth slowing to 1.1% this year, inflation rising to 2.9%; no need to cut rates now, sees single 25bps reduction late this year.
• House GOP leaders were still unsure whether they would cancel the July 4 recess to pass the mega bill, depending on whether the Senate could clear the bill by the weekend as planned, according to a Politico report. The decision depended on what changes the Senate made and whether the House would need to alter the bill.
• US President Trump posted "Members of Congress are united in their commitment to deliver the One Big Beautiful Bill "
• NHTSA seeks information from Tesla (TSLA) after Robotaxi debut, with regards to issues seen in online videos, according to Bloomberg. Tesla (TSLA) is sued by the estates of three people killed in a September 2024 crash in Model S with autopilot, according to a court filing.
• Amazon (AMZN) is to invest USD 54bln in the UK over the next three years, according to Reuters.
• Starbucks (SBUX), when asked to comment on media report, says it is not currently considering a full sale of its China operation. Earlier, it was reported Starbucks (SBUX) is reportedly mulling full sale of China business, according to Caixin.
• US Senate Majority Leader Thune said House will ultimately accept what the Senate passes, according to three senators in the room cited by Punchbowl.
• "Big Banks are worried [US] President Trump could turn the power of the federal government against them with an executive order on “debanking.”", via WSJ

CRYPTO

• Bitcoin is on a stronger footing and climbs back above USD 105k, amid the latest Iran-Israel ceasefire.

APAC TRADE

• APAC stocks traded firmer across the board with the region coat-tailing gains from Wall Street, which initially stemmed from Iran's "symbolic" strike on a US base in Qatar—de-escalatory in nature given the clear effort to minimise casualties and collateral damage. Sentiment was further boosted at the resumption of futures trading after US President Trump announced a ceasefire between Israel and Iran, although the Iranian Foreign Minister later clarified that there was no "agreement", but Iran would stop attacking if Israel also halts.
• ASX 200 was bolstered by most sectors, although energy producers and gold miners bore the brunt of the slide in oil and gold.
• Nikkei 225 gains and tested the 39k mark to the upside amid broader market optimism, although gains were somewhat capped by gradual JPY strength.
• Hang Seng and Shanghai Comp conformed to the broader tone across the market amid optimism surrounding the Israel-Iran ceasefire alongside the step-down in tensions with the US.

NOTABLE ASIA-PAC HEADLINES

• Japan’s Chief Cabinet Secretary Hayashi said Japan would hold its Upper House election on July 20th, according to Reuters.
• Japan’s finance ministry said top foreign exchange diplomat Atsushi Mimura would be reappointed for his second year, as he remained involved in US trade talks, according to Reuters.
• PBoC injected 406.5bln via 7-day reverse repos with the rate maintained at 1.40%.
• PBoC issues guidelines on financial support to boost consumption; to increase credit support for services consumption and key areas To increase support for the real economy. Support employment, boost income. Improve financial institutions capabilities, expand supply in consumer sector. Maintain ample liquidity. Strengthen financial services to help optimise consumption environment. Encourage issuance of consumption ETF. Support eligible enterprises in consumption industry chain to raise funds through listing. Support qualified consumer infrastructure companies in issuing REITs in the sector. To increase investment in key areas of services consumption.

DATA RECAP

• South Korean Consumer Sentiment Index (Jun) 108.7 (Prev. 101.8); highest since June 2021.

GEOPOLITICS

Note, the below is in chronological order with the newest updates at the bottom

Iran's attack on US base in Qatar

• Iran's Foreign Minister said Tehran’s attack on a US air base in Qatar was in response to US aggression against Iran’s territorial integrity and sovereignty, adding that Iran would be ready to respond again if the US took further action, according to Reuters.
• US President Trump posted "CONGRATULATIONS WORLD, IT’S TIME FOR PEACE!"
• Saudi Arabia stated that Iranian aggression against Qatar was unacceptable, could not be justified, and constituted a flagrant violation of international law, according to Al Arabiya.
• US Vice President Vance said Iran is now incapable of building a nuclear weapon with the equipment they have because the US destroyed it, according to a Fox News interview.

Israel-Iran Ceasefire

• US President Trump announced that Israel and Iran have agreed to a complete and total ceasefire, to begin at 00:00 EDT/05:00 BST, and lasting 12 hours. Trump stated that the war would be considered officially ended following this sequence. He praised both nations for ending what he termed “THE 12 DAY WAR.”
• Under the ceasefire announced by Trump, Iran would stop striking Israel in six hours (at midnight ET on Tuesday), and Israel is expected to stop striking Iran 12 hours after that (at noon ET Tuesday). Then, after another 12 hours, or at midnight ET Wednesday, the war will be considered over, a White House official confirmed to CBS News.
• US President Trump called the ceasefire between Iran and Israel — which he announced — a wonderful day for the world, according to NBC News. He said he believes the ceasefire is unlimited and is going to go “forever.”
• US President Trump and Vice President Vance discussed the Israel-Iran ceasefire proposal with Qatar’s emir after Iranian attacks on the airbase in Qatar on Monday, according to an official cited by Reuters. Qatar’s prime minister secured Iran’s agreement to the US ceasefire proposal in a call.
• Israel's Channel 12 reported that Israeli Prime Minister Netanyahu agreed to a ceasefire with Iran during talks with US President Trump, on the condition that Iran stopped its attacks.
• Israeli PM Netanyahu announced an agreement with Iran, noting that a comprehensive ceasefire agreement had been reached, according to Al Arabiya.
• Iranian Foreign Minister Araqchi said there was no "agreement" on any ceasefire or cessation of military operations between Israel and Iran. He stated that Iran had consistently made clear it was Israel that launched the war, not Iran. However, if Israel halted its "illegal aggression" against the Iranian people by 4 a.m. Tehran time, Iran had no intention to continue its response. He added that the final decision on halting Iran's military operations would be made later.
• Israel attacked a “substantial percentage” of the targets approved as part of Operation Am Kalvi, according to i24 journalist Stein. An Israeli source told him: “We will complete the attacks on all the approved targets within a few days.” The source warned: “If we need to, we have a very large pool of targets. There are still many places to attack in Iran.”
• Iranian officials made clear to the Trump administration that they would come back to the negotiating table and discuss their nuclear program on the condition that Israel stops bombing them, according to a senior US official via NYT.
• Iranian Supreme Leader Khamenei posted on X that “the Iranian nation isn’t a nation that surrenders.”
• US President Trump posted that Israel and Iran came to him “almost simultaneously” and said “PEACE!”, declaring that he knew the time was now. He said the world and the Middle East were the real winners. Trump added that both nations had much to gain and much to lose if they strayed from the road of righteousness and truth. He said the future for Israel and Iran was unlimited and filled with great promise.

Strikes since ceasefire announcement

• Israeli strikes were continuous as markets headed into Iran's proposed ceasefire time (01:30 BST) vs Trump's guided time (05:00 BST). Iranian media reported that tonight marked the most intense defensive operation since the beginning of Israel’s attacks on Tehran, according to Iran International.
• Iranian strikes continued after 01:30 BST, with several missiles fired towards Israel. Some reports noted an Iranian ballistic missile hitting an Israeli residential building, with three killed.
• An Iraqi military official said an unknown drone targeted the Taji military base north of Baghdad, with no casualties reported, according to the state news agency. Al Hadath reported a drone attack on US bases in Iraq, stating that four Iraqi military bases housing US forces were targeted, and added that there were no human casualties resulting from the attacks on the Iraqi military bases.
• The Israeli military said a fifth wave of missiles had been launched from Iran towards Israel.
• There were reports of the Israeli assassination in Tehran of Iranian nuclear scientist Mohammad Reza Sediqi.
• "Drone strike on radar of air base in southern Iraq", according to Sky News Arabia.

After the ceasefire came into effect

• "Iran fires missiles towards Israel, violating ceasefire announced by Trump", according to BNO Newsroom; " Israeli army: We are monitoring a sixth Iranian attack on Israel", according to Al Jazeera.
• Iran fired the last round of missiles towards Israel before the ceasefire came into effect, according to Iran's SNN.
• US President Trump posts, at 06:09BST/01:09ET, "THE CEASEFIRE IS NOW IN EFFECT. PLEASE DO NOT VIOLATE IT!"
• At 07:17BST/02:17ET Israeli PM Netanyahu confirmed the ceasefire is now in effect, war achieved its goals, will respond forcefully to any violations. PM's office adds that Netanyahu will deliver a statement later today.

Israel claims Iran has violated the ceasefire agreement

• Times of Israel journalist posts on X "The IDF says it has detected a new launch of ballistic missiles from Iran. Sirens are expected to sound in northern Israel in the coming minutes".
• Israel Finance Minster Smotrich says the ceasefire was violated, one launch was identified from Iran - "Tehran will tremble", via N12 News.
• "Two Iranian missiles were launched at northern Israel and intercepted according to an initial assessment", via Horowitz on X.
• Israel Defence Minister says he instructed the military to respond "forcefully" to Iran's violation of the ceasefire with high-intensity strikes against targets in the heart of Tehran.
• "Iran denies firing missiles at Israel after ceasefire - state media", via Soylu on X.
• Iran Top Security Body says "Iran's armed forces have no trust in the words of its enemies and will keep finger on trigger to respond to any further act of aggression", via Fars News.