[The Cook controversy reignites the crisis of Fed independence, the bond market inflation premium faces reassessment, and Warsh's policy space is tested] ⑴ Federal Reserve Chairman Warsh's efforts to keep the central bank away from politics have suffered a major setback. Last week, the White House attacked Governor Cook with unverified mortgage fraud allegations, shattering market optimism that Warsh would have sufficient policy space, and bringing the issue of independence back into focus. ⑵ This political pressure sends a dual signal: on the one hand, it shows that the government is concerned that the Fed may raise interest rates as early as next month; on the other hand, it reveals that the president realizes that even if his appointed chairman intends to block the rate hike, he may not be able to secure enough votes in the committee. This public pressure may even backfire, prompting Cook to adopt a hawkish stance. ⑶ Futures market pricing indicates a 75% probability of a 25 basis point rate hike before the midterm elections. The core driving factors are persistently higher-than-target inflation over the past six years, high core prices, and the energy shock related to Iran. The forecasts for the September meeting are almost evenly matched, making the timing of the attack on Cook intriguing. (4) In the increasingly divided Federal Open Market Committee, every vote is crucial. If Cook and Waller, who previously voted to keep rates unchanged, both shift to supporting a rate hike next month, the number of votes supporting tightening will rise to 7. Former Chairman Powell's stance will be a key variable in determining the final outcome. (5) Warsh himself may want more room to elaborate on his vague inflation target and policy philosophy of reduced communication, but maintaining distance is not easy. Market doubts are growing about whether the Fed remains firmly committed to price stability and whether it can effectively separate itself from the White House's political demands. (6) Institutional strategists point out that over the past 18 months, whenever the independence debate intensifies, long-term Treasury yields tend to rise while the dollar weakens. Currently, the market may be severely underestimating the medium- to long-term inflation risk premium. Indicators such as the five-year forward inflation swap deserve close monitoring. The next few weeks will be particularly important for rebuilding market confidence.

[Probability of US-Iran nuclear deal falls below key level, market bets on continued deterioration of negotiation prospects] ⑴ Data from a US prediction market platform shows that traders' expectations for a US-Iran nuclear deal have fallen to a new low, with the current probability of an agreement before 2028 at only about 40%. ⑵ The probability of contracts targeting a wider timeframe of January 20, 2029, has also fallen to around 50%. Both contracts have seen a significant decline from their spring highs, reflecting a rapid erosion of market confidence in the potential for diplomatic maneuvering between the two sides. ⑶ Recent verbal exchanges between the US and Iran have intensified. The US, in responding to Iran's conditions for peace talks, has demanded compensation, further reducing the room for compromise. The two sides show no signs of bridging their differences on core issues, putting continued pressure on the negotiation prospects. ⑷ The declining probability of a nuclear deal and the obstruction of passage through the Strait of Hormuz create a risk resonance. The former weakens hopes for geopolitical easing, while the latter directly threatens energy transport routes. Both factors reinforce the market's pricing in a prolonged standoff in the Middle East. (5) In the absence of breakthroughs in diplomatic channels, any statement concerning uranium enrichment, the lifting of sanctions, or regional security arrangements could trigger sharp fluctuations in contract prices. This indicator has become one of the real-time windows for observing the trend of sentiment in the US-Iran game.

[Russian Wheat Production Forecast Lowered Again; Shrinking Spring Planting Area Drags Down Global Supply Expectations] ⑴ Russian agricultural consulting firm IKAR lowered its 2026 wheat production forecast on Tuesday, slightly reducing it from 90.5 million tons to 90 million tons, mainly due to a lower-than-expected spring wheat planting area, putting pressure on the overall production outlook. ⑵ Along with the downward revision of the production forecast, the agency also lowered Russia's wheat export potential from 45 million tons to 44.5 million tons, reflecting a corresponding narrowing of the surplus grain available for export. ⑶ In addition to wheat, the country's total grain production forecast was also lowered from 140 million tons to 138.5 million tons, while the overall grain export potential was reduced from 61.5 million tons to 60 million tons, showing that the adjustment of the planting structure has a ripple effect on multiple grain varieties. (4) As the world’s largest wheat exporter, any marginal changes in Russia’s production and export expectations could have a transmission effect on the supply and demand pattern of the Black Sea region and even the international grain market. The Northern Hemisphere is currently in the critical harvest period, and subsequent weather and yield data will remain the focus of market attention.