Financial Markets Daily Report15 July 2026
Risk appetite improved on Tuesday after US inflation surprised to the downside in June. The CPI print was driven by falling energy prioces but also softer core services, particularly shelter, overshadowing Warsh’s hawkish remarks in Congress, where he said he has "no tolerance for persistently elevated inflation". Interest rate expectations for the Fed declined, with markets now pricing a second hike over the next 12 months with a 70% probability.
US sovereign yields fell too, led by the short end, steepening the curve. Eurozone rates, for their part, ended flat, reversing early-session hikes. In FX, the rates repricing weighed on the dollar, particularly against the euro.
In commodities, oil prices rose, although Brent pared gains after Trump said the proposed 20% levy on non-Iranian cargo transiting Hormuz would not be implemented. US equities advanced, supported by the strong earnings reports of big banks, while European indices were mixed and more muted.