IRAN: Rprt-Source: Indirect Talks w/US Poss In 2/3 Wks, Direct Talks If Progress
'Diplomatic' substack author Laura Rozen reports, according to an Iranian source, Tehran could agree to direct talks with the US if initial indirect talks make progress. The source claims that indirect talks could begin, likely in Oman, within two to three weeks and initially with little publicity.
- As we noted earlier today, Russia has also offered its assistance as a potential mediator (see 'IRAN: Russia Ready To Push For 'Reasonable Agreement w/US Before It's Too Late', 1049BST).
- In a swiftly deleted post on X, US Middle East envoy Steven Witkoff may have to directly replied to Iranian Foreign Minister Abbas Aragchi (direct communication between US and Iranian officials clearly not being the norm). The Iranian minister's post repeated a commitment from the 2015 Joint Comprehensive Plan of Action, that "Iran reaffirms that under no circumstances will Iran ever seek, develop or acquire any nuclear weapons." Witkoff's personal account replied “Great". A US official claims Witkoff did not write the reply, hence its deletion.
- US President Donald Trump has set a deadline of two months for Iran and the US to reach a new nuclear agreement, or risk a major escalation. If indirect talks do begin in 'two to three weeks', then this could see a deadline emerge in mid-to-late June.
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
EQUITIES: Attention turns to the US Open
Attention turns to the US Cash open, the Emini (ESH5) and the January 2025 low of 5809.00 just held, printed a 5812.00 low so far today, and finding some underlying bids ahead of the Open.
Cash SPX sees the January low standing at 5773.31, but the open will be some way short of that initial level, and Yesterday's low of 5810.91.
- Calls: SPX: 5,815.0 (-0.6%); DJIA: 43,020 (-0.4%/-171pts); NDX: 20,306.7 (-0.6%).
US TSY FUTURES: BLOCK: Jun'25 5Y Sale
- 6,000 FVM5 108-10, sell through 108-10.25 post time bid at 0915:24ET, DV01 $246,000. The 5Y contract trades 108-11.25 last (+8.5)
BUNDS: Futures Pierce Support On Bundesbank Debt Brake Reform Proposal
A fresh Bundesbank proposal for a debt brake tweak (outlined in a previous bullet) adds weight to Bunds in recent trade.
- Bund futures through initial support at 132.13, with next meaningful support seen at 131.72. Lows of 131.94 printed before a recovery to ~132.10.
- Fresh steepening on the curve results in cycle highs for both 2s10s and 5s30s at 47.5bp and 66.0bp, respectively.
- Swap spreads move lower, but long end ASWs vs. 3-month Euribor fail to breach cycle lows.
- Expect debt brake negotiations to be drawn out over the coming months, given different preferences/ideals across the political spectrum and shift in Bundestag composition in late March.
- Special funds remain the first port of call for near-term German fiscal support, although seemingly need to be passed before the new Bundestag sits (which is doable, but clearly time constrained).
