1. President Trump said US-Iran negotiations are in their “final stages” but warned of renewed military action if talks fail.

• Signs of easing tensions pushed oil prices lower.
– Brent crude:

– WTI crude:

2. FX volatility has declined sharply, pushing traders toward carry and relative-value strategies.

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1. The April FOMC minutes showed a growing number of officials favored removing the Fed’s easing bias and warned that persistent inflation could require the central bank to consider raising rates.

• Our FOMC Minutes Sentiment Indicator continued to tilt more hawkish.

• References to inflation rose while mentions of unemployment fell.

2. Mortgage applications fell as higher mortgage rates weighed on activity.

• Refinancing activity edged down slightly.

3. Business inflation expectations for the coming year rose to 2.4%, according to Atlanta Fed’s latest survey.

4. According to the Fed’s FCI-G Index, financial conditions eased back to near pre-Iran conflict levels in April.

• Our in-house measure has tightened recently, after easing further earlier this month.

5. The latest FDIC banking profile showed that banks’ net interest margin slipped further in Q1.

• Return on equity rebounded in the latest quarter, though the four-quarter moving average fell.

• Net charge-offs were stable.

6. The labor share and the natural rate of interest have been closely linked over the past quarter century.

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1. Canada’s 10-year yield fell the most in a single day since April 2025.

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1. Inflation eased more than expected, …