Gulf proposals

Daily update

Media reports suggest Iran’s government has proposed terms to the US to allow a reopening of the Strait of Hormuz. Markets’ bias to optimism produced a positive reaction. The terms apparently defer nuclear discussions, which may be a problem for the US administration. Recent polls gave US President Trump very weak approval ratings over the US affordability crisis, suggesting there could be political pressures to return to the pre-war position in the Gulf.
US Senator Tillis indicated support for a confirmation vote on Federal Reserve Chair nominee Warsh (following the Department of Justice ending investigations into the Fed). Warsh will need to build support for rate cuts and quantitative tightening, once confirmed.
China’s March industrial profits grew, continuing an improving trend. This is not a market focus, but might question the idea of excess capacity in China’s industrial sector. It also challenges protectionists who argue China is dumping exports (i.e., cutting export prices to sell at a loss).
The data calendar is mainly sentiment surveys. The Dallas Fed April manufacturing poll offers the entertaining comments section, and that might signal some of the political pressures around the economy. German consumer confidence weakened—hardly surprising given the media and social media narrative. Deteriorating sentiment since mid-2025 has been matched by unchanged consumer spending.