Iran ceasefire reduces likelihood of Federal Reserve rate hikes

Interest-rate futures contracts now reflect a one-in-four chance of a U.S. interest-rate cut by year-end. This shift follows a two-week ceasefire agreement in the Iran conflict, which eased concerns about a resurgence of inflation. Before the ceasefire, traders had priced in a chance of a Federal Reserve rate hike. The agreement has reduced the likelihood that conditions will pressure the Fed to hike rates this year, making rate cuts a possibility for policymakers later in the year.