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Daily US Global Rates Portfolio Archive Method
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Global Rates

May 24, 2026·Global Rates & Macro·8 markets screened
ECB deposit
2.00%
Unchanged
BOE base rate
3.75%
Unchanged
BoJ policy rate
0.75%
Unchanged
US Flash PMI May
55.3
+0.8 vs Apr.
WTI Oil
~$97
→ $80-85 if deal
USD/JPY
~152
Stable
The potential Iran deal (Axios: 60-day ceasefire, Hormuz reopened, announced potentially today) is reshaping the global rates landscape in real time. BoJ June hike odds have plunged from 82% on Friday to 59.5% — a 22pp drop in a single weekend. ECB June hike odds fell more modestly, from 83% to 76.5%. The mechanism is straightforward: a Hormuz reopening restores 3-5M bpd of global supply, pushing WTI toward $80-85. For the BoJ, this eliminates the primary imported inflation argument that hawks have used (Japan imports 90% of its energy). For the ECB, the HICP flash on May 30 — 6 days before the June 5 meeting — will now almost certainly show deceleration well below 3%. For the BOE, the thesis is more nuanced: UK services inflation above 5% is not energy-driven, and the deal doesn't structurally change the BOE's hawkish case. The BoJ market move represents the largest single-weekend repricing we have tracked — and with 59.5% still significantly above our fair value, it creates an attractive re-entry or add-on opportunity on NO.
Today's Market Moves
BoJ: +25bp June
82%→60%-22pp
Iran deal: WTI decline eliminates yen defense justification
ECB: +25bp June
83%→77%-6pp
Iran deal: HICP flash May 30 expected lower
BOE: hike 2026
69%→70%+1pp
Stable: UK inflation thesis not oil-driven — services sticky
ECB: +25bp July
36%→32%-4pp
June pause more likely → July even less likely
BOE: +25bp June
3%→3%0pp
Stable — long shot unchanged
Screening Table
# ↑Market ↕Expiry ↕Market Price ↕Fair Value ↕Gap (pp) ↕Direction ↕Volume ↕Confidence ↕
1BoJ: +25bp JuneJun 202660%38%-22ppSELL YES$133K
8/10
2ECB: +25bp JuneJun 202677%54%-23ppSELL YES$347K
7/10
3ECB: +25bp JulyJul 202632%15%-17ppSELL YES$N/A
5/10
4BOE: hike 2026Dec 202670%80%+10ppBUY YES$31K
6/10
5BOE: +25bp JuneJun 20263%12%+9ppBUY YES$226K
5/10
6BOE: hold JulyJul 202677%64%-13ppSELL YES$N/A
4/10
7CBR: cut JuneJun 202685%77%-8ppNEUTRAL$53K
4/10
8RBA: hike JuneJun 202610%7%-3ppNEUTRAL$29K
3/10
Top 5 Opportunities
1
BoJ: +25bp June — NO
Jun 2026·$133K·Confidence ★★★★☆ 8/10
↓ SELL YES-22pp
Market price
60%
Fair value
38%
Gap: -22pp
Largest single-weekend repricing in our tracking history: -22pp in two days (82% → 60%) driven entirely by Iran deal news. And yet at 60%, the market remains significantly overpriced. The BoJ's case for a June hike rests on three pillars: (1) weak yen requiring rate defense, (2) imported inflation from high oil, (3) hawkish internal pressure. The Iran deal directly undermines pillars 1 and 2. A WTI at $80-85 dramatically reduces Japan's imported inflation — Japan imports 90% of its energy. A stabilized dollar (Iran deal removes geopolitical risk premium) means USD/JPY could even retreat, removing the yen defense argument. The 6-3 April vote for the status quo hasn't changed. Japan FY2026 GDP at 0.5% argues against tightening. The three hawkish dissenters face a much weaker case in June. Our fair value: 38%. Gap: 22pp.
▵ Bull case
  • 3 active hawkish dissenters: still pushing for hike
  • Spring Shunto +5% wages: domestic demand argument remains
  • Japan core CPI 2.8% still above 2% target
  • Iran deal may collapse within days
▿ Bear case
  • Iran deal: WTI → $80-85 = Japan's imported inflation sharply lower
  • Dollar/yen pressure eased with deal risk premium gone
  • 6-3 vote: majority for status quo unchanged
  • Japan FY2026 GDP 0.5%: no growth justification for tightening
  • US auto tariffs: export shock Q3-Q4 weighs on outlook
Buy NO if fair value < 50% — threshold crossed at 38%
Exit signal: Iran deal collapses + WTI > $115 → oil pressure on yen returns → reduce. USD/JPY > 158 → BoJ forced to defend yen → exit.
Next catalyst: Iran deal official announcement — today, May 24. BoJ meeting — June 16-17, 2026.
2
ECB: +25bp June — NO
Jun 2026·$347K·Confidence ★★★★☆ 7/10
↓ SELL YES-23pp
Market price
77%
Fair value
54%
Gap: -23pp
The ECB market has moved less dramatically than BoJ (-6pp vs -22pp) but the gap has actually widened: 77% vs our fair value of 54% = 23pp. The Iran deal is transformational for the May 30 HICP flash — the most important single data point before the June 5 meeting. With WTI trending toward $85-90 (Friday close $97, deal expected today), the energy contribution to May HICP will be sharply negative. If HICP flash prints at 2.4-2.7% (our estimate), the ECB has no institutional grounds to hike. The ECB already held in April at 3.0% — if May comes in at 2.5-2.7%, the case for hiking is even weaker. The deal's timing is almost perfect for our position: it comes 6 days before the critical HICP print, and 12 days before the ECB meeting.
▵ Bull case
  • Eurozone HICP still above 2% target even with deal
  • German fiscal stimulus: domestic demand remains elevated
  • Bloomberg consensus: two ECB hikes still expected for 2026
  • Wage growth in eurozone: services inflation structural
▿ Bear case
  • Iran deal: HICP flash May 30 likely 2.4-2.7% — ECB can't justify hiking
  • ECB held in April at 3.0%: precedent strongly against June hike
  • Strong dollar (PMI US 55.3): euro stable → imported disinflation
  • BCE 'data-dependent': HICP flash 6 days before meeting is decisive
  • Deal removes 60-day WTI premium: energy component turns negative
Buy NO if fair value < 67% — threshold crossed at 54%
Exit signal: HICP flash May 30 >= 3.0% → ECB still constrained → reassess. Iran deal collapses before May 30 → WTI spikes → exit.
Next catalyst: Eurozone May HICP flash — Eurostat, May 30, 2026. ECB meeting — June 5, 2026.
3
BOE: hike 2026 — YES
Dec 2026·$31K·Confidence ★★★☆☆ 6/10
↑ BUY YES+10pp
Market price
70%
Fair value
80%
Gap: +10pp
The BOE is the exception to today's Iran-deal repricing. UK inflation is not primarily energy-driven — services CPI above 5% is structural and immune to oil price movements. The OECD projects UK CPI at 4% for 2026, second highest in the G7 after the US. The April MPC vote was 8-1 for status quo but with explicit hawkish language: one dissenter already voted for a hike. The Iran deal actually clarifies the BOE's dilemma: with oil falling globally, if UK CPI remains elevated in May and June, the culprit is entirely domestic — making the BOE's case for hiking stronger, not weaker. 70% for at least one hike by December remains underpriced. The June 18 CPI publication (same day as BOE meeting) is the binary catalyst.
▵ Bull case
  • UK services CPI > 5%: not oil-driven, persists regardless of Iran deal
  • OECD projection 4% for 2026: highest G7 after US
  • 1 MPC dissenter already: needs 4 more to hike
  • Iran deal clarifies domestic inflation source → BOE more likely to act
▿ Bear case
  • 8-1 vote: 8 members comfortable holding
  • Iran deal reduces UK headline CPI via energy
  • Fragile UK growth: BOE weighing recession risk
  • Low liquidity ($31K)
Buy YES if fair value > 62% — threshold crossed at 80%
Exit signal: UK CPI May (June 18) < 3% → BOE no reason to hike → exit. UK GDP turns negative → exit.
Next catalyst: UK CPI May — ONS, June 18, 2026. BOE meeting — June 18, 2026.
4
ECB: +25bp July — NO
Jul 2026·N/A·Confidence ★★☆☆☆ 5/10
↓ SELL YES-17pp
Market price
32%
Fair value
15%
Gap: -17pp
Secondary trade, now with an even stronger thesis. If our ECB June NO resolves correctly (no June hike), July becomes near-impossible: the ECB doesn't hike one month after a hold, especially with HICP declining. If the ECB does hike in June (adverse scenario), it still takes a pause to assess impact. In both scenarios, 32% for a July hike is excessive. The Iran deal adds a third layer: if HICP drops to 2.4-2.7% in May and continues declining in June-July (WTI at $85), the ECB's sequential hiking rationale disappears entirely. Bloomberg consensus (June + September, not July) aligns with our view.
▵ Bull case
  • Inflation rebounds if Iran deal collapses
  • ECB could choose to front-load two consecutive hikes
▿ Bear case
  • ECB never hikes in consecutive months without data validation
  • Iran deal: HICP trajectory now declining through summer
  • Bloomberg: June + September hike schedule (not July)
  • June meeting outcome alone makes July moot
Buy NO if fair value < 22% — threshold crossed at 15%
Exit signal: ECB hikes in June AND HICP May > 3.0% → trade invalidated → exit.
Next catalyst: ECB June meeting (June 5, 2026) → determines validity of July trade.
5
BOE: +25bp June — YES
Jun 2026·$226K·Confidence ★★☆☆☆ 5/10
↑ BUY YES+9pp
Market price
3%
Fair value
12%
Gap: +9pp
Asymmetric option position unchanged. At 3¢ for a YES, this remains a lottery ticket with meaningful optionality. The Iran deal actually slightly improves this thesis: if UK CPI on June 18 stays above 4% despite lower global oil (driven by services), the BOE faces an urgent domestic inflation problem it can't blame on geopolitics. The precedent (50bp surprise June 2023) remains. The key scenario: CPI surprises to the upside on June 18 (same day as the BOE meeting), triggering an emergency-style consensus shift on the MPC. Low probability — but at 3¢, the risk-reward is asymmetric.
▵ Bull case
  • Iran deal paradox: if UK inflation stays high despite lower oil, domestic urgency increases
  • 2023 precedent: 50bp surprise hike
  • CPI published same day as meeting: data-dependent binary
▿ Bear case
  • 8-1 vote: 4 additional dissenters needed in 4 weeks
  • Iran deal reduces headline CPI globally including UK
  • BOE institutional conservatism
Buy YES if fair value > 11% — threshold crossed at 12%
Exit signal: UK CPI May < 3% → exit immediately.
Next catalyst: UK CPI May — ONS, June 18, 2026 (same day as BOE meeting).