SYDNEY: Share markets surged in Asia on Monday while the dollar slipped and oil prices tumbled as a tentative peace deal between the United States and Iran promised to ease inflationary pressures globally and lessen the need for higher interest rates.

Pakistani Prime Minister Shehbaz Sharif said on social media early on Monday that a deal had been struck, while President Donald Trump said the agreement included opening the vital Strait of Hormuz, though without giving details.

Trump will meet with Middle Eastern ‌leaders and attend a working ⁠session with ⁠Ukrainian President Volodymyr Zelenskiy during a G7 summit in France this week.

Iran said traffic through the strait would be regulated by it and Oman, a potential blow to the rules of free trade and suggesting there might be a toll of some sort on shipping.

“The lack of details especially on freedom of shipping is a concern but not one that should constrain markets today as the surge in risk appetite plays out,” said Sean Callow, a senior FX analyst at ITC Markets.

“The prospect of a sustained fall in energy prices changes the conversation for central banks just ahead of a flurry of policy decisions.”
The news will be a relief for the crowd of central banks meeting this week, easing some of the pressure to tighten policy to head off an energy-driven rise in inflationary expectations. Markets had already priced ⁠in a likely ‌deal but the confirmation was enough to send Brent crude falling 4% to $83.80 a barrel, well away from its May peak of $126.41. U.S. crude slid 4.7% to $80.89 a barrel, but was still above the $67 level it traded at before the war began.

“We see Brent oil futures falling ⁠to $80 by the end of the year assuming the strait does not close again,” said Vivek Dhar, a mining and energy analyst at CBA.

“Our forecast implicitly assumes that oil and refined product exports can resume quickly through the Strait of Hormuz, but this view carries considerable uncertainty tied to the damage to oil and refinery assets.”

The prospect of cheaper oil will be a boon to Japan which is a net importer of energy, and the Nikkei climbed 3.0%. South Korea’s red-hot market gained 4.3%, while MSCI’s broadest index of Asia-Pacific shares outside Japan rose 1.5%.

RELIEF FOR CENTRAL BANKS
In Europe, EUROSTOXX 50 futures and DAX futures both rose 0.2%, while FTSE futures added 0.3%.

S&P 500 futures climbed 0.9%, while Nasdaq futures jumped 1.5% amid a general surge in risk assets.

Central banks are due to meet in the U.S., UK, Japan, Australia, Switzerland, Sweden, Norway and Russia this week, with Japan ‌considered the one likely to lift rates this time.

The Federal Reserve is widely expected to leave rates at 3.50%-3.75% on Wednesday at Chair Kevin Warsh’s debut meeting. The statement, economic projections and news conference will be scrutinised for any signals of the Fed dropping its easing bias as officials grow more hawkish on inflation risks. Investors were quick ⁠to trim the chance of a hike this year with December futures edging up four ticks while a move as early as October is now priced around 45%.

Treasuries rallied on hopes that oil prices would now fall sustainably and lessen the upside risks for inflation. Yields on 2-year notes dropped 6 basis points to 4.02%.

The drop in yields and general improvement in risk pulled the U.S. dollar broadly lower, with the euro rising 0.4% to $1.1608. The dollar dipped 0.2% on the yen to 159.90 , while sterling rose 0.3% to $1.3446.

The Bank of England is expected to hold rates at 3.75% on Thursday and through 2026, with policymakers seen in no rush to tighten. The BoE’s vote split and monetary policy report will be of interest.

Top-tier UK data includes May inflation and retail sales, and April employment. Thursday’s Makerfield election will also be watched, as a win for Labour Mayor Andy Burnham could set up a leadership contest against Prime Minister Keir Starmer.

In commodity markets, the drop in yields helped non-interest-paying gold climb 1.9% to $4,300 an ounce.

A senior Trump administration official tells FOX Business that Anthropic’s “recklessness” in responding to issues with the company’s latest artificial intelligence release led to export controls.

The official says there are ongoing talks about fixing the vulnerabilities with the company’s Fable 5, but claims the administration’s interactions with Anthropic created a lack of trust. The official believes the experience damaged Anthropic’s relationship with the government over its unwillingness to address the concerns.

The export controls imposed by the Commerce Department forced the company to pull down its latest release. Anthropic received a letter from the Commerce Department saying its Fable 5 and Mythos 5 models were banned for use by any foreign national “inside or outside the United States,” due to national security concerns. A source familiar with calls to Anthropic says the company brushed off the federal government’s initial concerns. A source close to the company disputes that, adding it was not presented with any details and never refused to fix issues.

ANTHROPIC FILES CONFIDENTIALLY FOR IPO

After a flurry of phone calls on Friday, the official familiar with the outreach tells FOX Business the company claimed Anthropic CEO Dario Amodei was at a wellness retreat and could not be reached about the concerns. A source close to Anthropic denies there was a retreat, says the company’s executives were not hard to reach and claims they were in touch with the White House within 15 minutes.

Still, the senior administration official says Anthropic’s reaction to potential issues led to the export controls, adding the government says the company did not take the request to fix issues seriously enough, given the expectations set before the Fable 5 rollout.

The feeling within the Commerce Department, Treasury Department, and White House is that Anthropic could have avoided the drastic step of export controls by engaging on a deeper level.

Multiple sources say the government made it clear to Anthropic that this release would be the first test case for the new executive order signed regarding AI guardrails. A Washington, D.C., tech policy expert tells FOX Business this is “government messaging 101” – that if a company is leading the conversation on AI safety, then appears reluctant to address any safety concerns, the administration will take a tough stance.

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Administration officials say the concerns were realized last week when Amazon AI experts were able to orchestrate a “jailbreak” on Fable 5 after it was released on June 9 alongside Mythos 5, the latter of which was only released to a limited group. Anthropic said the cyberattacking abilities of the new models were constrained, but Amazon and five other companies testing the release found a workaround in Fable 5 that opened the full cyber abilities of Anthropic’s more advanced model.

FOX Business reached out to Amazon for comment.

Under its leadership, the Trump administration has taken an all-of-government approach to making sure new AI models meet national security standards. The export controls originated in the Commerce Department, but the Treasury Department is being increasingly looped in due to its knowledge of computer power and markets.

A former Trump administration official tells FOX Business that President Donald Trump is business-friendly to a point, adding that if a company is slow to address issues, the president will force it to make the necessary changes. The former administration official expressed concern that the export controls will not be easily removed if Anthropic continues to brush off the issues being raised at the highest levels of government.

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In a statement on June 12, Anthropic said, “We reviewed a demonstration of this specific technique being used to identify a small number of previously known, minor vulnerabilities. These vulnerabilities all appear relatively simple, and we have found that other publicly-available models are able to discover them as well without requiring a bypass.”

A source close to Anthropic says there were no details in the initial call with government officials, just a request to pull down the Fable 5 model within 90 minutes. The source adds that Amodei and other senior staff have been engaged from the beginning, there was no refusal to fix an issue and the company remains eager to resolve any concerns.

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FOX Business has also learned Anthropic senior technical staff are in Washington, D.C., to meet with White House officials. Another source tells FOX Business virtual meetings have been held every day since the administration’s initial outreach about the vulnerabilities.

A Maryland dairy is recalling all of its cheese products after health officials warned they may be contaminated with listeria.

Clover Hill Dairy of Mechanicsville, Maryland, has agreed to voluntarily recall every cheese product it makes, including ricotta, cheddar, Monterey Jack, pepper jack and other varieties, according to a Sunday announcement from the Maryland Department of Health.

Health officials said eight listeria infections and one death may be linked to the recalled cheese.

FDA ISSUES HIGHEST-RISK RECALL FOR ALFREDO SAUCE SOLD IN 41 STATES

“The facility has agreed to initiate a voluntary recall for all of its cheese products,” the Maryland Department of Health stated.

The recall expands an earlier recall for Clover Hill soft ricotta cheese sold from May 4 through May 30 in North Carolina, New York, Virginia, Maryland, New Jersey and Washington, D.C.

The recalled ricotta were sold in 10-, 12- and 14-ounce clamshell containers. Some packages may list plant number 24-128 on the label. The cheese was sold through retail stores, bulk distributors and direct-to-consumer sales, according to a June 9 notice from the U.S. Food and Drug Administration.

FROZEN PIZZA SNACK RECALL HITS 21 STATES OVER POSSIBLE METAL CONTAMINATION IN PRODUCT

The recalled cheese may also have been sold in bulk 5-gallon and 2-gallon buckets and repackaged under other brand names, including KESSO, QUESOS LA RICURA, IZALCO, DE MI PUEBLO and RIO LINDO.

Maryland health officials suspended the dairy’s license on May 30 because of the public health risk.

Listeria can cause fever, severe headache, stiffness, nausea, abdominal pain and diarrhea. The bacteria can be especially dangerous for young children, older adults, pregnant women and people with weakened immune systems. In pregnant women, listeria can cause miscarriage or stillbirth, according to the FDA.

CDC URGES PARENTS TO STOP USING NARA ORGANICS INFANT FORMULA AFTER THREE BABIES HOSPITALIZED WITH BOTULISM

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Consumers who purchased the recalled cheese should not eat it and should return it to the place of purchase in its original packaging for a full refund.

“Clover Hill Dairy board and staff members sincerely apologize for any inconvenience and hardships caused by this recall, and we sincerely hope to correct this problem as soon as it is safely possible,” the company said in the June 9 recall notice.

Clover Hill Dairy could not immediately be reached by FOX Business for comment.

For several global central banks, the question of whether the Iran war poses more of an immediate danger to inflation or to growth is likely to remain open in the coming week.

Officials responsible for monetary policy in seven of the world’s most-traded currency jurisdictions are anticipated to keep settings steady again. A well-flagged rate hike from the Bank of Japan to continue its exit from low borrowing costs and a close call in Norway are likely exceptions, but the US Federal Reserve and its peers from the UK to Sweden are expected to make no changes.

The urge to wait longer to gauge the impact of a conflict whose duration just surpassed 100 days may be reinforced by the US President’s efforts to secure a peace deal with Iran. That process will play out against the backdrop of his expected attendance at a summit of the Group of Seven in France on Monday.

But a sense of divergence within the club of advanced economies is already crystallising after the European Central Bank delivered its first interest-rate increase since 2023.

Peers in Norway and Australia have already raised rates, although they have no urgency to do so again. Meanwhile, the Swiss National Bank, whose policy is impacted by safe-haven flows into the franc, will probably keep its own rate at zero.

In all, more than 20 central banks accounting for upwards of 40% of world output between them are slated to make rate decisions, pointing to how the week may largely bookend the first half of 2026. Among the highlights further afield, officials in Brazil and Russia may cut borrowing costs, while a Czech hike could also materialise.
Elsewhere, Chinese data covering sectors from retail to industry, Japanese inflation, a vote in Switzerland on a possible population cap, and a summit of EU leaders in Brussels will be among the highlights.US and Canada
The Fed gathers on June 16-17 for the first meeting to be overseen by the new Chairman Kevin Warsh, who was previously a Fed governor from 2006 to 2011. Officials are widely expected to keep borrowing costs steady, but the outlook is less clear.

On the heels of a stronger-than-expected jobs report, US inflation rose in May at the fastest pace in more than three years. If those price pressures persist, policymakers may have to consider raising rates.

Officials will scrutinise an array of data, including consumer spending. Shoppers in the US have proved resilient, though with prices now rising faster than wages, they’re coming under increasing pressure.

In Canada, retail sales data for April and a flash estimate for May are likely to show headline growth, driven by higher gasoline prices. The question is whether spending in other categories also increased. Consumers in March mostly pulled back as rising energy costs absorbed a larger share of budgets.

Meanwhile, existing home sales for May are likely to remain subdued. In contrast, manufacturing and wholesale sales are expected to have continued rising in April, supported by elevated oil prices.

It is important to remember that the last rites for the convertible have been read before. In the 1970s and 1980s, for example, sales plummeted as stricter safety restrictions made them more expensive to build, while consumer tastes moved towards high-performance hatchbacks. The increasing prevalence of air conditioning, meanwhile, took away part of the convertible’s USP.

“The impact goes beyond financial loss; it can cause huge emotional harm, leaving victims burdened by guilt and shame, which is why we must tackle the problem at its source to protect consumers,” said Paul Davis, head of economic crime at Barclays. Experts believe the majority of scams are unreported, so do not even register in the statistics.