Ceasefire between Israel and Iran already being tested as markets bet it will stave off ‘stagflationary shock’

A consumer refuels their vehicle at a gas station in Daegu, South Korea, on June 23, 2025, while geopolitical risks heighten due to U.S. attacks on Iran's nuclear facilities. (Credit: Photo by Seung-il Ryu/NurPhoto via Getty Images)

• President Donald Trump announced a ceasefire between Iran and Israel—easing oil market fears that Iran would close the Strait of Hormuz, a critical waterway to global oil trade. Analysts say even a slight disruption on the strait could shock a U.S. economy already preparing for a rise in inflation and force the Fed to hold interest rates throughout the end of the year. Later, Israel claimed that Iran had violated the ceasefire—and promised retaliation.

A ceasefire announced by President Donald Trump Monday evening and later confirmed by Israel has been put to the test as Israel’s defense minister claimed this morning that Iran had already broken the cessation of hostilities and said he had ordered new retaliatory strikes on Tehran.