Trump Says U.S.-Iran Deal Could Be Reached as Early as This Weekend; Fed Signals No Rush to Change Rates

Daily News

Summary:

Trump says a U.S.-Iran agreement could be finalized as early as this weekend; Williams says there is currently no need to raise or cut interest rates.

Headlines at a Glance

1. Israel and Lebanon agree to implement a ceasefire and establish pilot zones

2. Trump says the U.S. maritime blockade of Iran could last until September

3. U.S. House passes resolution seeking to limit military action against Iran

4. Canada extends import restrictions on steel and aluminum for one year

5. Iran outlines a four-phase plan for reaching an agreement with the United States

6. Ending all conflicts across regional fronts is the top priority in U.S.-Iran negotiations

7. Trump says a U.S.-Iran deal could be reached this weekend

8. Iran warns it will resume hostilities if Israel attacks Beirut

9. U.S. ADP employment rises by 122,000 in May; ISM Services PMI exceeds expectations

10. Fed Beige Book: Prices are rising at a moderate to strong pace

11. Williams: No need to raise or cut rates for now

News Details

Israel and Lebanon Agree to Implement a Ceasefire and Establish Pilot Zones

The U.S. State Department stated that, following negotiations led by the United States, Israel and Lebanon have agreed to implement a ceasefire. Under U.S. guidance, both sides have also agreed to move quickly in establishing pilot zones. Within these zones, the Lebanese Armed Forces will exercise exclusive control over the designated territories, while all non-state actors will be excluded.

Trump Says U.S. Maritime Blockade of Iran Could Last Until September

In an interview aired on June 3, U.S. President Donald Trump said that the U.S. maritime blockade of Iran could remain in place until Labor Day, September 7. However, he added, “I think that's unlikely. I believe we will reach a deal. I think this issue will be resolved very quickly.”

Trump said negotiations with Iran are progressing rapidly. “We will not allow them to have nuclear weapons, and many other positive developments will follow,” he said.

U.S. House Passes Resolution Seeking to Limit Military Action Against Iran

On Wednesday, the U.S. House of Representatives passed a resolution by a vote of 215 to 208 aimed at limiting the president's authority to wage war against Iran. Four Republican lawmakers joined Democrats in supporting the measure.

The resolution stipulates that military action against Iran cannot proceed without explicit congressional authorization. The vote reflects growing concern about the conflict, even within Trump's own Republican Party.

The measure is largely symbolic at this stage. To become law, it must pass the Senate and secure a two-thirds majority in both chambers to override what is widely expected to be a presidential veto.

Canada Extends Steel and Aluminum Import Restrictions for One Year

Canada announced on Wednesday that it will extend import restrictions on steel and aluminum from countries other than the United States and Mexico for one year.

The move highlights the ongoing challenges facing Canada's manufacturing sector amid trade disruptions triggered by President Trump's policies. Canada's finance minister said the measures would remain in place until the end of June 2027, pending cabinet approval. He described the extension as part of Canada's commitment to protecting steel workers and the domestic industry from trade diversion and non-market policies that contribute to global overcapacity.

Iran Outlines a Four-Phase Plan for Reaching an Agreement with the United States

According to Iranian media outlet Fars News, Iran has outlined a four-phase framework for reaching an agreement with the United States.

The first phase focuses on a complete cessation of military operations across all fronts, including those involving Iran, the United States, and the so-called Axis of Resistance.

The second phase centers on implementation measures addressing four key issues: the Strait of Hormuz and related mechanisms, lifting the blockade, removing oil restrictions and sanctions, and unfreezing certain Iranian assets.

The third phase would initiate broader negotiations on sanctions and nuclear issues after objective and verifiable measures have been implemented.

The fourth phase involves establishing a supervisory committee to oversee implementation of the agreement and monitor compliance by all parties.

Ending All Regional Conflicts Is the Top Priority in U.S.-Iran Negotiations

On June 3, Ebrahim Azizi, Chairman of the Iranian Parliament's National Security and Foreign Policy Committee, said that ending all conflicts across regional fronts is the primary objective of negotiations between Iran and the United States.

Azizi stated that Iran would never allow the United States and Israel to undermine the unity of the regional "Axis of Resistance." He added that Iran firmly believes the resistance front will ultimately prevail and that, through collective efforts, the goal of defeating Israel can be achieved.

Trump Says a U.S.-Iran Deal Could Be Reached This Weekend

Trump said negotiations between the United States and Iran are progressing well and that an agreement could be reached as early as this weekend.

“I hear that the negotiations themselves are going very well—actually, very well. If a deal is reached, it could be announced this weekend,” Trump said.

It is worth noting that the U.S. House of Representatives has passed a resolution seeking to limit President Trump's authority to use military force against Iran and calling for an end to U.S. military operations against the country.

Iran Warns It Will Resume Hostilities if Israel Attacks Beirut

Iranian Foreign Minister Abbas Araghchi recently reiterated Iran's support for Lebanon, stating that if Israel continues its aggression against Beirut, the Iranian Armed Forces will resume military operations and strike targets inside Israel.

Araghchi said Iran has clearly informed the United States that any Israeli military action against Beirut would be regarded as a complete collapse of the ceasefire, which Iran would not tolerate. He warned that Iran would respond militarily.

Regarding negotiations with the United States, Araghchi said communication has not been severed but that no substantive progress has been made. Conditions for returning to the negotiating table include safeguarding Iran's national interests, ending the conflict in Lebanon, and reducing regional tensions. He added that the United States has come to fully recognize Iran's capabilities and influence through recent confrontations.

U.S. ADP Employment Rises by 122,000 in May; ISM Services PMI Beats Expectations

The U.S. ADP employment report, often referred to as the "private payrolls" report, showed that private-sector employment increased by 122,000 jobs in May, the largest gain since January of last year.

The figure was slightly above the market expectation of 120,000 and higher than the previous reading of 109,000. The data suggests that the labor market has remained resilient despite the surge in energy prices.

Meanwhile, the Institute for Supply Management (ISM) reported that its Services PMI rose to 54.5 in May, exceeding the market forecast of 53.8 and the previous reading of 53.6.

The prices paid index rose to 71.3, the new orders index climbed to 57.3, the employment index stood at 47.9, and the business activity index reached 57.7.

Fed Beige Book: Prices Rising at a Moderate to Strong Pace

The Federal Reserve's Beige Book noted that prices are generally increasing at a moderate to strong pace, with most districts reporting higher inflation rates than in the previous report.

Many districts cited energy costs related to the Middle East conflict as a primary driver of inflationary pressure, affecting sectors including shipping, packaging, groceries, and fertilizers.

Non-labor costs continue to rise faster than selling prices, raising broader concerns about profit margin compression. Companies' ability to pass higher costs on to consumers varies considerably, particularly among consumer-facing businesses.

Several districts reported that firms are responding to inflation through supply-chain optimization, product adjustments, reduced supply, and temporarily absorbing higher costs to maintain customer demand.

Williams: No Need to Raise or Cut Rates for Now

New York Fed President John Williams said on Wednesday that he is not overly concerned about inflationary pressures stemming from the conflict, the lingering effects of tariffs, or significant second-round effects from artificial intelligence investment.

He expects inflation risks arising from the Middle East conflict to be temporary. If the Strait of Hormuz reopens, U.S. inflation is likely to peak within the next two months, while economic growth remains solid and labor market conditions stay stable.

Williams said there is currently no clear direction for future interest rates and no need to adjust monetary policy through either rate hikes or rate cuts. He also does not believe forward guidance would be particularly helpful at this stage.

Today's Focus

13:00 (UTC+8) Reserve Bank of Australia Governor Michele Bullock testifies before the Senate

14:30 (UTC+8) Switzerland May CPI

16:00 (UTC+8) ECB President Christine Lagarde speaks

17:00 (UTC+8) Eurozone April Retail Sales MoM

23:40 (UTC+8) Bank of England Governor Andrew Bailey speaks at the Investment Association conference

01:10 (UTC+8) San Francisco Fed President Mary Daly speaks

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