Federal Reserve rate outlook and Middle East tensions shape global markets

Goldman Sachs and JPMorgan analysts said that a new interest‑rate hike by Turkey’s central bank is unlikely through the end of 2024 unless financial markets deteriorate sharply. Their reports highlighted a dovish tone in the recent policy statement and noted that inflationary pressures would need to intensify before a hike is considered.

In the United States, the Federal Reserve is expected to keep policy rates steady, but the upcoming first meeting of new chair Kevin Warsh could alter market expectations. Analysts at ING and other banks see a high probability that the Fed will not cut rates and may even keep a hawkish stance, supporting a strong dollar against low‑interest‑rate currencies.

Geopolitical developments in the Middle East, especially the tentative US‑Iran talks and statements from former President Donald Trump about a possible peace agreement, have moderated oil‑price volatility. Brent crude fell about 6.5% to roughly $86 per barrel, while U.S. Treasury yields slipped to 4.49% on the 10‑year note.

U.S. inflation data showed CPI up 4.2% year‑on‑year in May, keeping inflation concerns alive. The market also reacted to SpaceX’s successful IPO, with shares climbing up to $176.52 and ending the day up 19.2%.

Commodity prices reflected the mixed backdrop: gold slipped 2.6% to $4,217 per ounce, while silver and palladium rose modestly. Overall, investors are weighing Fed policy signals, Turkish rate expectations, and Middle‑East risk factors as they shape asset‑class performance.