Global Credit Bullets | Monday, 15th June 2026

Iran – 14 Points of Agreement

Last week’s escalation shifted decisively toward a deal. After days of missile launches, drone attacks and renewed threats from President Trump, markets remained relatively resilient, treating most of the rhetoric as noise rather than a sign of imminent military action. The turning point came on Thursday, ahead of SpaceX’s IPO, when Trump announced that the Memorandum of Agreement had been accepted. Local Iranian media later reported that the 14-point agreement had been approved by both sides, including Iran’s reconstruction bill and the release of frozen funds, but apparently without any binding language on missiles or the nuclear programme. The deal therefore looks less like a clear U.S. victory and more like a setback for Washington, which appears to have conceded on several sensitive points in exchange for de-escalation and the reopening of the Strait of Hormuz. With oil touching new lows, the sky is the limit for markets.

ECB – A hike without clear guidance

Last week, the ECB raised its reference rate by 25bp to 2.25%, in line with expectations. The new staff projections pointed to a more challenging macro backdrop, with higher inflation and weaker growth relative to the March forecasts. Core inflation, in particular, was revised up by 20bp to 2.5% in 2026 and by 30bp to 2.5% in 2027. During the press conference, President Lagarde struck a balanced tone and avoided giving markets any explicit guidance on the next steps. The shift in policy stance, combined with the absence of a clear signal regarding the future path of policy, weakened the case for a July hike. However, subsequent comments from ECB officials suggested that the next meeting remains live and that no option can be ruled out. A back-to-back hike would send a strong signal of the ECB’s commitment to fighting inflation. At the same time, it could also raise concerns about growth, especially as activity indicators across Europe are showing signs of deterioration rather than acceleration.

Fed – Warsh takes the chair

This week marks the beginning of a new era for the Federal Reserve, as Kevin Warsh is set to chair his first meeting as head of the U.S. central bank. With headline inflation still running above 4% and core PCE at 3.3%, there is little room for rate cuts at this stage. The focus will therefore be primarily on communication. A press conference is expected, but uncertainty remains around the future path of projections and the broader direction of policy going forward. The dot plot has long served as an anchor for markets, but it could also be argued that it has occasionally constrained the Fed by forcing it to follow its own forward guidance too closely. Under Warsh, investors will closely monitor the balance between policy orthodoxy and any potential coordination with the U.S. Treasury. With risk assets at all-time highs and the economy still performing robustly, Warsh faces a difficult task: managing communication, building consensus within the Committee, and responding to rising inflation expectations. In this environment, monetary policy is already becoming looser in real terms simply by not hiking.

Algebris Investments’ Global Credit Team