President Trump said the United States refrained from bombing Iran at the request of Gulf allies, a move that underscored the delicate coalition dynamics as the Middle East conflict continues to feed global inflationary pressures.
The war has rattled fixed‑income markets. Citi warned U.S. 30‑year yields could reach 5.5% if the shock persists, while the OECD said the global economic outlook faces the risk of further deterioration as inflation expectations climb. The developments cast a pall over the G7 meeting in Paris, coming amid one of the most severe sovereign bond sell‑offs in years.
Macro data offered a mixed picture. Japan’s economy expanded an annualised 2.1% in 1Q26, beating estimates and potentially giving the Bank of Japan room to tighten policy to support the yen. China is targeting about 6 billion yuan in a Hong Kong green bond sale as authorities seek funding for climate and infrastructure projects. Risk appetite showed tentative improvement: European and Asian equities rose roughly 0.5%–1%, while U.S. futures looked set to open slightly lower. Oil eased about 1%, with Brent trading near $110 a barrel, as markets weighed the balance between geopolitical risk and signs of easing near‑term demand
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