Hormuz · NEAR-OPEN
≈15 mb/d passing through now · recovering (vs ~20 mb/d normal flow pre-crisis) · strait reopens on Friday signing for mine clearance · waivers on Iranian oil exports immediate
As of Thu 18 Jun 2026, 06:30 GST
The four numbers Thursday is opening on.
3.8%
Median 2026 dot
up from 3.4% · now implies a hike
−1.21%
S&P 500 · Wed
rate-cut trade unwinds
+17 bps
US 2-Yr yield
to 4.216% · the curve's biggest move
Friday
Iran signing
Hormuz reopens for mine clearance
A hold, and a hawkish turn: Warsh ends the rate-cut trade.
Markets repriced in one direction: equities fell, Treasuries sold off across the curve with the 2-year up 17bps, and the dollar posted its strongest session in weeks while gold slipped. Traders now fully price higher borrowing costs by October. The week’s offsetting catalyst is geopolitical — the interim US–Iran agreement is set to sign Friday, with immediate oil-export waivers and the Strait of Hormuz reopening for mine removal; oil sits near multi-month lows.
Yields jump, equities fall, the dollar firms on the dots.
- Equities fell across the board — rate-sensitive growth and small-caps hit hardest.
- The front end moved most — the 2-year jumped 17bps; the dollar had its best day in weeks and gold slipped.
- Oil held near multi-month lows, anchored by the imminent return of Iranian supply.
−1.21%
S&P 500 · Wed
rate-cut trade unwinds
+17 bps
US 2-Yr yield
to 4.216% · biggest curve move
3.8%
Median 2026 dot
up from 3.4% · implies a hike
+0.72%
DXY
best day in weeks
Long-duration tech led the drop as the front end repriced toward a hike.
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Front end repriced toward a 2026 hike; markets fully price higher rates by October.
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Note: yield-up = red, yield-down = green (bond-price convention).
Anchored by imminent Iranian supply; the firmer dollar caps any bounce.
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Hawkish dots and higher front-end yields drove a broad dollar bid.
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The Fed's projections moved: inflation up, the cut gone.
Chart of the Day · FOMC median projections
Inflation marked up hard; the cut became a hike.
Between March and June the Fed lifted its end-2026 rate dot above the current range — so the next move is now up — and raised its inflation forecast sharply.
Source: Federal Reserve Summary of Economic Projections (March & June 2026); BLS May CPI.
Three headlines shaping today's session.
The Fed
Warsh remakes the Fed's playbook
- Abolished formal forward guidance, trimmed the statement to ~130 words and declined to submit his own dot.
- Practical effect: every data release now moves markets more, with no pre-set path to fall back on.
CNBC · Reuters · NPR · Wed 17 Jun
Equities
A hawkish turn ends the June rally
- Rate-sensitive corners hit hardest — Russell 2000 −1.78%, long-duration tech led lower.
- The VIX jumped ~15% as the rate cut got priced out and a hike moved into view.
TheStreet · Yahoo Finance · Bloomberg · Wed 17 Jun
Geopolitics
US–Iran deal set for Friday signing
- Immediate oil-export waivers, a 60-day window for a final nuclear deal, and a ~$300bn reconstruction framework.
- Hormuz reopens on signing for mine clearance; oil holds near multi-month lows.
Reuters · NBC News · Al Jazeera · Wed 17 Jun
Caught between a hawkish Fed and a closing peace deal.
The Gulf imports US policy through its dollar pegs, so a hawkish Fed tightens regional financial conditions even where local growth is firm. UAE shares slipped with global markets on Wednesday, giving back part of the week’s deal-driven gains; banks and rate-sensitive real estate led the pullback.
Vault Wealth’s house view: constructive on GCC financials and domestic-demand names, cautious on rate-sensitive real estate. The Iran deal removes the war premium and points to softer crude — helpful for importers, a headwind for the oil majors. Friday’s signing and a visibly reopening Hormuz matter more than any single session’s move.
UAE equities
Lower
Track global weakness on the hawkish Fed signal
Currency pegs
Dollar-linked
GCC imports US higher-for-longer policy
Hormuz
≈15 mb/d
NEAR-OPEN · reopens Friday for mine clearance
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