US Strikes Iran Again as Markets Weigh Fed Signals and Oil Prices
Fresh US military action against Iran rattled markets July 15 as the Fed held cautious on rates and crude settled near $79.60.
The United States carried out another round of military strikes against Iran on Tuesday, July 15, even as President Trump told Fox Business that Tehran is seeking a diplomatic meeting and wants to negotiate a deal — but he signaled additional military operations remain on the table. The dual track of diplomacy and force sent immediate ripples through energy and currency markets, with Iranian parliament speaker Qalibaf vowing his country would "stand to the end" to protect national security interests.
Crude oil futures settled at $79.60, up $0.26 or 0.33%, as traders weighed the geopolitical risk premium against a weekly EIA inventory draw of 1.692 million barrels — smaller than the 2.594 million barrel drawdown analysts had expected. The White House was separately reported to be weighing an extension of Jones Act waivers, a sign that policymakers are alert to fuel supply disruptions that renewed Iran tensions could trigger.
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On the monetary policy front, Federal Reserve Chair Warsh testified before the Senate Banking Committee, while Fed governors Cook and Williams both struck a patient tone. Cook said it is "prudent to wait a bit longer" for inflation to decelerate before cutting rates, and Williams stressed that restoring inflation to the 2% target on a sustained basis remains imperative. The Fed's Beige Book confirmed that growth continues across most districts but flagged lingering uncertainty — language that gives the central bank cover to hold steady.
Economic data released Tuesday offered a broadly constructive picture. The New York Fed's Empire Manufacturing index surged to 15.6 in July, well above both the 8.80 consensus estimate and June's 5.70 reading. US June producer prices came in at 5.5%, undershooting the 6.2% forecast, adding to evidence that upstream inflation pressures are easing. Canada also posted upside surprises: the Bank of Canada held its benchmark rate at 2.25% as expected, but the central bank noted Q2 growth looks "pretty solid" and the economy appears to be in expansion, while May manufacturing sales rose 1.3% versus the 1.1% estimate.
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