Deutsche Bank analysts, including Mark Wall and team, argue Germany faces multifaceted headwinds from the Middle East conflict, with growth momentum weakening into mid‑2026. Expansionary fiscal policy is seen as the key stabilizer, keeping Gross Domestic Product (GDP) growth at 0.5% in 2026.
Dow Jones Industrial Average (DJIA) futures spent the overnight session doing their best impression of a market that has decided geopolitics no longer matter.
NZD/USD trades around 0.5930 on Tuesday at the time of writing, virtually unchanged on the day, after giving back part of the gains recorded earlier this week.
The AUD/USD pair elevated near the 0.7190 level on Tuesday as the US Dollar (USD) failed to find support following stronger-than-expected labor market data.
ABN AMRO economists Bill Diviney and Rose Heaulme note that Eurozone headline inflation rose to 3.2% in May, with core inflation surprising at 2.5%. Energy remains the main driver, while food inflation eased.
EUR/USD holds firm on Tuesday as traders react to conflicting headlines surrounding US-Iran negotiations. At the time of writing, the pair trades around 1.1639 after touching a daily high near 1.1655.
The Pound Sterling (GBP) rises by about 0.19% on Tuesday against the US Dollar (USD) as traders remain optimistic about a peace deal between the US and Iran despite ongoing geopolitical uncertainty. The GBP/USD pair trades at around 1.3470 after bouncing off daily lows of 1.3446.
Megan Greene, a member of the Bank of England's (BoE) Monetary Policy Committee (MPC), warned on Tuesday that United Kingdom (UK) households and businesses appear more sensitive to rising inflation than in the past, emphasizing that the risks of failing to act against persistent inflation outweigh t
RaboResearch says Sweden’s weak Q1 GDP was driven by lower government spending but partly offset by household consumption and inventories.
The National Bank of Poland (NBP) met the broad consensus among market participants and held interest rates steady, adopting a cautious tone on Tuesday, saying that future data would guide policy choices but also that inflation concerns are very much alive.
Scotiabank's strategists Shaun Osborne and Eric Theoret notes the Canadian Dollar (CAD) is underperforming into renewed United States (US)‑Canada trade talks, with USD/CAD trading in the mid‑1.38s.
ING economists Peter Virovacz and Zoltán Homolya say Hungary’s latest GDP data show the economy emerging from stagnation, but they stress that much of the recent strength reflects temporary pre-election factors.
DBS Group Research strategist Eugene Leow warns that low Oil inventories, especially in the United States, could keep Oil prices and global yields supported even if a US-Iran deal reopens the Strait of Hormuz.
Commerzbank’s Dr. Vincent Stamer argues persistent Euro area inflation above 3% and rising core pressures make an European Central Bank (ECB) rate increase unavoidable. He cites firms’ intentions to pass on higher energy costs and elevated consumer inflation expectations.
The number of job openings in the United States (US) came in at 7.618 million in April, up sharply from the revised 6.887 million in March, the US Bureau of Labor Statistics (BLS) reported in its Job Openings & Labor Turnover (JOLTS) report on Tuesday.
Société Générale economist Sam Cartwright notes Euro area headline inflation rose to 3.2% year-on-year in May, with core inflation at 2.5%. Services, not energy, led the increase, partly due to Easter timing effects.
Gold (XAU/USD) remains trapped within a two-week range on Tuesday as traders track rapidly changing headlines from the Middle East. At the time of writing, XAU/USD trades around $4,493 after touching an intraday high of $4,541.
ING analysts Warren Patterson and Ewa Manthey note that Oil prices remain highly sensitive to shifting US–Iran negotiation headlines, with recent breakdowns in talks boosting prices. They highlight additional risks from Iranian threats in the Bab el‑Mandeb and Russia’s jet fuel export ban.
USD/JPY ticks higher on Tuesday, moving toward the 160.00 mark once again and raising the risk of another intervention by Japanese authorities. At the time of writing, the pair trades around 159.80.
West Texas Intermediate (WTI) edges lower on Tuesday, trading around $90.15 at the time of writing, down 0.89% on the day.
MUFG’s Derek Halpenny and Abdul-Ahad Lockhart underline that the latest ISM Manufacturing data show strong United States (US) economic resilience despite Middle East uncertainty. The headline index has reached a four-year high, with broad-based gains across sub-indices and rising new orders.
Deutsche Bank economists say in their World Outlook (WO) report, the United Kingdom (UK) entered the energy shock with stronger Q1‑2026 data, prompting only a marginal downgrade to growth. Stockpiling is expected to cushion activity as higher energy costs feed into inflation and real incomes.
Nordea’s Tuuli Koivu and Anders Svendsen argue that persistent inflation pressures and a resilient labour market point to a new European Central Bank (ECB) hiking cycle starting in June.
TD Securities raises its outlook for Silver and PGMs despite near-term correction risks similar to Gold. The team upgrades Silver and PGM forecasts over the next two quarters and further improves the long-term view, citing Gold’s projected strength and an improving global economy.
ING’s Francesco Pesole warns that USD/JPY short-dated implied volatility is not reflecting renewed intervention risk as the pair retests 160.0. Markets seem to expect the Bank of Japan’s June meeting to help cap the pair.
DBS Group Research’s Philip Wee argues that FX Majors remain range-bound as markets digest shifting narratives around Middle East tensions and the upcoming Fed leadership transition.
Brown Brothers Harriman’s Elias Haddad writes that mixed Eurozone Consumer Price Index (CPI) data and a fully priced 25 bps European Central Bank (ECB) hike leave the Euro (EUR) under pressure but not collapsing.
Beth Hammack, President of the Federal Reserve (Fed) Bank of Cleveland, struck a distinctly hawkish tone on Tuesday, warning that persistent inflation risks may eventually require a policy response.Key Quotes
Rabobank’s Senior FX Strategist Jane Foley focuses on the Swedish Krona (SEK), noting that SEK has been the weakest G10 currency since the Iran war but has recently outperformed on a one‑month view.
Commerzbank’s Michael Pfister argues that the Brazilian Real’s (BRL) strong run is likely to pause as fiscal expansion, renewed inflation pressures and a polarized election weigh on sentiment.
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