Overview

On 15 June 2026, Reuters reported that the United States and Iran announced an interim peace agreement that would end the three‑month conflict that had been threatening the global economy. President Donald Trump declared the deal “complete” on Sunday evening, authorising the toll‑free opening of the Strait of Hormuz and the immediate removal of the U.S. naval blockade of Iranian ports.

Deal Details

The parties agreed to sign a memorandum of understanding (MoU) in Switzerland on Friday, with Pakistan acting as chief mediator. Pakistani Prime Minister Shehbaz Sharif said the two nations had “declared the immediate and permanent termination of military operations on all fronts,” including Lebanon. Iran’s foreign ministry spokesperson Esmaeil Baqaei indicated that the signing ceremony was likely to take place on Friday and that, under the MoU, Washington would be obliged to lift all sanctions on Iran. Both sides said further negotiations on sticking points such as Iran’s nuclear programme and sanctions would continue for 60 days after signing. Trump later told reporters in France that Iran had “fully agreed” never to possess a nuclear weapon, while a senior Iranian official said Tehran would refrain from further uranium enrichment or expanding its nuclear facilities.

Currency Market Reaction

At 16:55 ET (20:55 GMT), the U.S. Dollar Index slipped 0.1 % to 99.68, reflecting reduced safe‑haven demand. The euro rose 0.2 % to $1.1587, and the British pound edged up to $1.3411. The Japanese yen was noted as weakening, remaining above the 160‑per‑dollar level that had previously prompted intervention.

Commodity and Inflation Impact

Oil prices fell following the peace‑deal news, easing inflationary concerns. The reduction in the risk of a prolonged Hormuz blockage gave the Federal Reserve additional breathing room ahead of its upcoming policy meeting.

Central Bank Outlook

The Federal Reserve’s monetary‑policy committee is set to announce its first rate decision under new chair Kevin Warsh on Wednesday. With recent strong labour‑market and inflation data, markets expect the Fed to keep the policy rate unchanged. The European Central Bank had already become the first major reserve bank to hike rates last week, citing the Iran‑linked energy shock.

Analyst Commentary

Macquarie global FX & rates strategist Thierry Wizman emphasized that the reopening of the Strait of Hormuz outweighs other considerations for markets, noting that normalised oil flows could weaken the dollar and benefit the euro and yen. He added that any new U.S. import tariffs could further support diversification away from the dollar.

Other Central Bank Decisions This Week

The Bank of Japan is widely expected to raise its benchmark rate to 1 % on Tuesday, the highest level in more than thirty years, while the Bank of England is also slated to announce its decision later in the week.

Key Figures

  • Dollar Index: 99.68 (‑0.1 %)
  • Euro: $1.1587 (+0.2 %)
  • Sterling: $1.3411 (+0.08 %)
  • Expected BoJ policy rate: 1 %
  • Oil price trend: downward (specific price not disclosed)