Finance

Oil prices experienced downward pressure after political reassurances indicated no immediate military escalation in the Middle East before the upcoming midterm elections. Additionally, a new supply deal arranged with Russia to deliver more diesel to global markets helped stabilize energy costs. Despite the daily relief, West Texas Intermediate and Brent crude futures still hover at highly elevated levels due to persistent transit disruptions near the Strait of Hormuz.

The 10-year Treasury yield hovered around 5.24% on Friday, remaining close to the 24-year peaks established earlier in the week. Yields initially shot up on strong domestic economic metrics, including lower-than-anticipated jobless claims, which have intensified expectations for upcoming Federal Reserve rate increases. Fixed-income markets closed early ahead of the federal holiday, keeping the focus on broader macroeconomic tightening pressures.

A preliminary report from the University of Michigan revealed that consumers have raised their one-year inflation forecasts to 4.7%. The data highlights growing unease regarding the long-term impacts of the ongoing conflict with Iran on domestic living costs. This shifting outlook has caused consumer sentiment to fall sharply, particularly among lower-income demographics who are disproportionately affected by rising prices.