• Meanwhile in markets, the question is: will they or won’t they? Despite Tehran’s denials about participating in tomorrow’s US-Iran talks, markets aren’t acting like the ceasefire is about to collapse;

• Yes, equity markets have retreated from Friday’s highs. The Stoxx 50 is down a percent and a half this morning and S&P 500 futures are down over half a percent. Even so, that is still over ten percent above their March low. Meanwhile, Brent crude is up nearly $10 a barrel from Friday’s lows, though it remains well below the $100 mark at $95.85. Overall, while there is clearly some fear in the market, there is no sign of a full blown panic;

• Bond yields have moved higher compared to Friday’s close, with Bunds up 2–7 basis points in a bear-flattening pattern. While that’s a notable move, it only retraces about half of Friday’s decline. The same goes for US Treasury yields, which are up 1–3bps;

•  Over in Pakistan, the US delegation – VP JD Vance and Trump’s diplomatic ‘dream team’ of Steve Witkoff and Jared Kushner – may just be on a lovely holiday as Iranian attendance of the negotiations is still unclear. Following the weekend’s continued blockade and ship seizure by the US, Tehran is signaling it will skip negotiations. Iranian state media signaled the US blockade must be lifted to resume talks. Still, the door for talks remains open: Iran’s FM spokesperson says no final decision on attendance has been reached. Iranian President Pezeshkian also remains firm that there is no appetite for war, urging that all diplomatic avenues be exhausted to de-escalate;

• Shifting to broader market commentary, the broad dollar is up around a quarter of a percent today. The Swiss franc continues to hold onto its recent strength, EURCHF is trading below 0.92 – matching its April lows. Gold is trading at around $4,790 per troy ounce, roughly $100 below Friday’s highs;

• Looking ahead, the schedule is empty today. Tomorrow there is more in store, with plenty of ECB-speakers, some SNB-speak and the release of US retail sales data.

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