Next Week's Macro Outlook: Focus on US-Iran Negotiation and Fed Personnel Changes, Middle East Tensions Roil Markets

April 18th – Global markets posted a significant rebound over the past week, driven by easing Middle East tensions, though core uncertainties linger. Iran briefly announced the opening of the Strait of Hormuz, triggering a sharp drop in oil prices. Risk assets surged: U.S. stocks hit a new high, the U.S. dollar weakened, and gold approached the $1,900 mark. However, Iran later clarified the strait remains "under military control," while the U.S. maintained sanctions on Iran—escalating market concerns about the situation. ### Next Week’s Key Catalysts - **U.S.-Iran Negotiations**: President Trump noted talks could advance over the weekend, warning the ceasefire may end and conflict risk resume if no deal is reached by next Wednesday. Iran remains cautious, with major differences on core issues like uranium enrichment. Markets have shifted from pricing in "conflict escalation" to a "de-escalation path," but sudden shifts could spark intense asset volatility. - **Fed Policy Signals**: Falling energy prices eased inflation pressures, pushing market expectations of a Fed rate cut this year to ~60%. Fed Chair nominee Kevin Warsh will testify at a Senate hearing next week; his stance (especially dovishness) will be a key driver for gold and risk assets. ### Upcoming U.S. Economic Data (ET) - **Tuesday 8:30 PM**: March Retail Sales (MoM) - **Thursday 8:30 PM**: Initial Jobless Claims (April 18 week) - **Thursday 9:45 PM**: April Markit Manufacturing/Services PMI (Flash) - **Friday 10:00 PM**: April University of Michigan Consumer Confidence (Final) & 1-Year Inflation Expectations (Final) ### Short-Term Focus Markets will center on three key variables: U.S.-Iran negotiation progress, oil price trends, and Fed policy signals.