Global Economic Weekly: The art of delaying deals

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Global Economic Weekly: The art of delaying deals

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Global Economic Weekly

The art of delaying deals

Global Letter: The art of delaying deals 29 May 2026

A US-Iran deal seems imminent. How many times have we heard that over the last two Economics

months? It seems this time could be different, but how robust can a temporary deal to Global

gain time to negotiate a more permanent one be? In any case, markets have chosen to

believe that a deal is around the corner for weeks while energy inventories are running Table of Contents

down. Why should we be concerned about that if a deal is around the corner, the market

Global Letter 2

argument goes. Our BofA Commodities team still forecasts an average price for Brent of

US 4

$92/bbl for 2026 but a credible peace deal with full reopening could drop Brent average

price to $82/bbl. Euro area 7

China 10

Emerging EMEA 12US: Tinker Taylor, Labor, Supply

Taylor Rule models suggest policy is about 100bp too easy, based on core PCE inflation. Latin America 15

That gap disappears when we exclude the tariff impact. In terms of the outlook, Warsh Key forecasts 17

thinks the Fed should look through all supply shocks, including Iran. Others on the FOMC Detailed forecasts 18

are not fully convinced. But history suggests that this is a fundamentally dovish FOMC, Research Analysts 24

which only raises rates when the labor market forces its hand.

Claudio IrigoyenEuro area: Second-round effects, so far so good Global Economist

Cost pressures are rising, but far from 2022-level disruptions. April granular details BofAS

suggest pass-through into ex-energy remains limited. Core underlying trend is not a +1claudio.irigoyen@bofa.com646 855 1734

worry for us. Wages are still cooling and medium-term expectations seem anchored.