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Iranian officials privately expressed pessimism over the prospects of reaching an agreement with Washington before the U.S. elections in November, following limited progress in talks held in New York. The gap between the two sides became clear after Trump denied an Axios report claiming he would be willing to ease sanctions and release frozen Iranian funds in exchange for concrete steps on the nuclear program.

Our Take

Although contacts through intermediaries continue, the public positions of both sides reduce expectations of a near-term full reopening of the Strait of Hormuz. This keeps risks to oil supply elevated and leaves markets exposed to renewed increases in crude prices, with potential implications for inflation and interest-rate expectations.

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The euro area’s economic sentiment index fell to 97.9 points in September from 98.4 in August, below analysts’ expectations of 98.8. Consumer confidence also weakened, falling to -16.5 from -15.5 points, in line with the preliminary reading and expectations.

Our Take

The deterioration in confidence points to weaker consumption in the months ahead. For the European Central Bank, this complicates the outlook, as slowing economic momentum coincides with pressure from higher energy prices, forcing policymakers to monitor both activity and the risk of a renewed pickup in inflation.

The Reserve Bank of Australia unanimously raised its policy rate by 25 basis points to 4.6%, the highest level in 15 years. The decision is aimed at containing the renewed rise in inflation linked to the conflict in the Middle East. The central bank warned that it could raise rates again if necessary.

Our Take

The three rate hikes delivered this year have already tightened financial conditions, while the economy is showing signs of slowing. Even so, the central bank believes that inflation remains too high and that the latest increase is necessary to bring it back to target within a reasonable timeframe.

At 8am today, The Conference Board’s U.S. consumer confidence index will be released. The indicator is expected to edge lower, from 89.4 points in August to around 89.0 in September. Investors will be watching for any improvement in household expectations and what respondents say about employment and inflation.

Our Take

A marginal decline would do little to change the outlook for U.S. consumption, which has remained resilient despite higher energy costs. A larger-than-expected drop, particularly in employment expectations, would point to growing pressure on households. If the index surprises to the upside, it would reinforce the view that demand remains firm and place greater emphasis on upcoming inflation and employment data when assessing the case for another Fed rate hike.

Corporate News

OpenAI is holding DevDay 2026 in San Francisco this Tuesday, its annual developer conference. The event will begin with remarks from CEO Sam Altman and will include technical sessions, demonstrations and updates related to the company’s tools and APIs. The event also comes after reports that OpenAI has delayed the planned launch of its new GPT-6.1 Astra model after determining that it did not meet the company’s internal safety standards.

Smart-ring maker Oura announced Tuesday that it will postpone its initial public offering on the Nasdaq due to market uncertainty, despite strong investor demand.

AMD agreed to acquire World Labs for approximately $8.2 billion in stock. The startup, founded by Fei-Fei Li, develops spatial-intelligence models capable of creating and simulating three-dimensional environments from images, video and text, with potential applications in robotics.

Shein shares fell 11% in Hong Kong after the fast-fashion retailer reported a 53% decline in first-half profit in its first earnings report as a publicly traded company.

The To-Do List

  • Review August JOLTS job openings and September U.S. consumer confidence, both due at 8am

  • Follow remarks from voting Fed officials Michael Barr and John Williams, along with four other officials speaking at various events today

  • Today’s routine: 3 rounds of 40 seconds of fast marching with high knees, 12 shoulder presses with bottles and 16 alternating knee-to-elbow crunches. Rest 20 seconds between exercises and 30 seconds between rounds. Approximate duration: 8 minutes.

  • Watch for any further developments in the debate over AI safety, including OpenAI’s developer conference and Trump’s lunch with industry executives on the risks posed by the technology

  • Remember that today marks another anniversary of the 1934 inauguration of the Palacio de Bellas Artes in Mexico City

Quote of the Day…

“It doesn’t matter whether a cat is black or white, as long as it catches mice”... Deng Xiaoping