The markets are abuzz with the latest economic data and central bank speakers, but it's the US-Iran crisis that's truly capturing the spotlight. In the European session, the final Eurozone CPI report is expected to have a muted impact on the ECB's decision-making, as the focus remains firmly on the ongoing tensions between the US and Iran. This crisis is casting a shadow over global growth prospects and risk sentiment, and it's not just the markets that are feeling the heat. The American session brings a few US data releases, including Housing Starts/Building Permits, Import/Export prices, Industrial Production/Capacity Utilization, and the University of Michigan Consumer Sentiment report. However, with the probabilities for a rate hike in July and September both significantly reduced, the Fed's decisions are unlikely to be influenced by these releases. The peak inflation narrative has taken precedence over concerns about Fed tightening, and the US-Iran crisis is the only thing currently holding back the market from a full-on rally. The market's reaction to these developments will be crucial in shaping the future of global economic policy and risk sentiment. As we await the next wave of news, it's clear that the US-Iran crisis is the elephant in the room, and its impact on the markets and the global economy will be felt for some time to come. The central bank speakers, such as ECB's Cipollone, may offer some insights, but the real action will be in the ongoing negotiations and the market's response to the unfolding crisis.
