Peace in the Middle East appears to be upon us, with a ‘MOU’ signed between Iran and the USA, which will be officially signed by the end of the week. Oil prices tumbled to around US$80/barrel, while equity markets soared, applauding the milestone. The Strait of Hormuz will be reopened, under the agreement, while negotiations continue. The US Dollar was softer, with the EUR regaining 1.1600, while the GBP traded above 1.3400.The weaker reserve allowed more consolidation of commodity currencies, with the AUD trading around 0.7075, while the NZD pushed back above 0.5820. Markets will now focus on Central Bank rate decisions, led by the Fed, with pressure relieved. The spike in inflation will be temporary, if the peace holds, allowing Central Banks the luxury of a more dovish tone.
