Prolonging uncertainty

Daily update

European powers begin nuclear talks with Iran, and the US has signaled that it does not intend to decide on military strikes against Iran for two weeks. That means two weeks of uncertainty for financial markets, but investors are still inclined to see the Middle East conflict as a local, not a global, economic issue.
Canadian Prime Minister Carney has suggested that there would be additional taxes on domestic consumers of US steel products in a month’s time, depending on the progress of trade talks with the US. This seems like a negotiating tactic. A little more troubling was the threat to tax imports of steel and aluminum from other countries, if they exceed 2024 levels and in the absence of a free trade deal. That is a (modest) broadening of the trade conflict beyond the current narrow “US versus everyone” stance.
Japan’s May consumer price inflation was as expected. Non-fresh food prices are rising quite dramatically, which might impact inflation perceptions by consumers (using the international measurement, core inflation slowed).
UK May retail sales are due—the UK consumer remains in a reasonably good place. The consensus estimates for this data are based off very few inputs, making it difficult to price market expectations.