Key Takeaways
- The Swiss National Bank (SNB) maintained its policy rate at 0.00% on Thursday, marking one year of unchanged borrowing costs while warning of a "heightened readiness" to intervene in currency markets to curb Swiss franc appreciation.
- Global oil prices have plummeted nearly 40% from their 2026 peak, with Brent crude falling to $75.49 per barrel following the signing of a U.S.-Iran Memorandum of Understanding (MoU) to end the regional conflict.
- U.S. equity markets reached new record highs, with the S&P 500 ETF Trust (SPY) trading near $740.96, as investors cheered the de-escalation of Middle Eastern hostilities and the removal of the U.S. naval blockade.
- Shipping normalization in the Strait of Hormuz is expected to take months, according to the Lloyd's Market Association, due to the need for demining operations and the clearing of a backlog of approximately 118 stranded tankers.
The Swiss National Bank (SNB), led by Chairman Martin Schlegel, opted to keep interest rates at 0% during its June 18 meeting. While the decision was widely anticipated, the central bank emphasized its "increased willingness" to act in the foreign exchange market to prevent an "excessive appreciation" of the Swiss franc (CHF). Schlegel noted that while the Iran war has driven energy prices higher, medium-term inflationary pressure remains stable, with May CPI at just 0.6%.
In the United States, President Donald Trump took to Truth Social to celebrate the economic impact of the recently signed peace framework. Trump dismissed critics of his Iran policy, highlighting that the "Stock Market Just Hit A RECORD HIGH" while oil prices are "tumbling" down. The President confirmed the immediate removal of the U.S. naval blockade, authorizing "Ships of the World" to resume transit through the region.
Despite the political breakthrough, the Lloyd's Market Association (LMA) and other maritime experts warned that the restoration of the Strait of Hormuz will be a gradual process. The LMA indicated that full normalization could take months as insurers remain wary of residual risks, including sea mines. Lloyd's List Intelligence estimated that it will take at least 10 to 15 days just to clear the immediate backlog of tankers currently anchored in the Persian Gulf.
Energy markets have reacted sharply to the news of the "Islamabad MoU," which outlines a 60-day window for a final peace deal. Brent crude has fallen from a conflict high of $126.41 to approximately $75.49, a decline of over 9% in the last 96 hours alone. Major producers like Saudi Arabia (ARMCO) have already begun adjusting official selling prices downward in anticipation of restored Iranian supply.
The broader market sentiment remains bullish as the threat of a global energy shock recedes. While the European Central Bank (ECB) raised rates last week, the SNB's decision to hold steady reflects a unique domestic environment where a strong franc has helped contain imported inflation. Investors are now shifting focus to the formal signing ceremony scheduled for Friday, which is expected to trigger the next phase of the regional de-escalation.
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.