James Campion
James Campion
United Arab Emirates
4mo
Michael Every, Rabobank | "Ceasefire Is Not Peace" Michael Every warns the market's relief rally on the US-Iran ceasefire is premature. The key question is not *if* there's a truce, but *who blinked*; the answer determines the next major move for the dollar and global assets. Markets are celebrating a "total and complete" de-escalation, with Brent futures dropping 14% and 10-year German Bund yields collapsing 18bp. Every views this as a dangerous misreading of a fragile, two-week truce. THE GEOPOLITICAL BINARY The outcome hinges on which side conceded, creating two wildly divergent paths for markets: • US Win: If Iran blinked under US military pressure, it's a major victory for Trump. This is Rabobank's base case, supporting a stronger dollar and risk assets. • US Defeat: If the US blinked due to oil prices and Iranian resistance, Every sees a "massive 1956-style geostrategic defeat." This outcome is profoundly negative for the dollar, GCC, and western assets. WATCH THE STRAIT The key proof point is the Strait of Hormuz. The US demands a "full reopening," but Iran claims it will still enforce tolls and limit passage to just 10-15 ships per day, a fraction of normal flows. This physical reality will signal who truly has leverage, regardless of headlines. The fog of war remains thick, and the initial risk-on reaction ignores the immense underlying uncertainty. Source: Rabobank |
Not investment advice. The author may have financial interests in the mentioned instruments.
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