A fairly slow start to the trading week despite little headway is peace negotiations between the US and Iran over the weekend.

President Trump sharply criticized Iran’s response to the reported U.S. 14-point peace framework, calling it “totally unacceptable,” “garbage,” and “unbelievably weak.” He said he did not even finish reading the response because he felt Iran was “playing games.”

Trump also said the ceasefire was “on life support” following Tehran’s counterproposal, signaling growing frustration that negotiations may be breaking down.

The U.S. proposal reportedly included:

• A long-term halt or severe limits on uranium enrichment
• Removal of highly enriched uranium from Iran
• Dismantling or reduction of key nuclear facilities
• Restrictions tied to regional proxy groups and missile programs

Iran’s response reportedly focused more on:

• Ending the war and military operations
• Lifting sanctions and blockades
• Reopening oil exports and shipping lanes
• War reparations
• Maintaining parts of its nuclear infrastructure and enrichment rights

That gap appears to be the core sticking point. Trump indicated the Iranian response failed to seriously address the nuclear demands that Washington views as essential.

The stalemate comes ahead of the meeting between US and China. Ahead of that meeting the US treasury enacted sanctions on 12 individuals and entities for aiding Iran’s oil shipments to China. China relies on oil from the middle east.

The US dollar is ending the day mixed to modestly higher against the major currencies today, with the greenback showing its strongest gains versus the Japanese yen while posting only modest changes elsewhere. The moves come as traders continue to balance higher crude oil prices, shifting yield dynamics, and ongoing geopolitical headlines tied to Iran developments.

The clearest directional move is in the USDJPY, where the pair is up 0.36% to 157.21. Higher US yields and firmer oil prices helped support the dollar against the yen, with the pair remaining near session highs at 157.27. The move higher suggests buyers remain in control in that pair for now.

Against the European currencies, the dollar is little changed overall. The EURUSD is down slightly by -0.03% at 1.1780, while the GBPUSD is lower by -0.15% at 1.3612. The modest declines imply mild dollar buying versus both the euro and pound, although neither pair has broken away aggressively from recent ranges. UK PM Starmer’s run as PM is under stress after a poor showing at the recent elections.

The USDCHF is also showing dollar strength, with the pair up 0.18% at 0.7777. The Swiss franc had been one of the stronger currencies in recent weeks, so today’s rebound in USDCHF reflects some short-covering and stabilization in the dollar.

Commodity-linked currencies are more mixed. The USDCAD is trading slightly higher by 0.02% at 1.3679 as traders weigh stronger crude oil prices against broader US dollar demand. Meanwhile, the AUDUSD is essentially flat at 0.7247, showing only a 0.04% decline, suggesting the Australian dollar is holding relatively firm despite the broader dollar bid.

The NZDUSD is also little changed but weaker on the day, down -0.08% at 0.5960. The New Zealand dollar has lagged the Australian dollar slightly, although price action remains relatively contained overall.

Overall, the dollar’s gains today are being led by strength against the yen and Swiss franc, while the euro, pound, and commodity currencies are holding in relatively narrow trading ranges as markets continue to assess the macro and geopolitical backdrop.

The US yields moved higher with the 2 year up 5.9 basis points to 3.951%. The 10 year yield rose by 4.8 basis points to 4.4124%. The US treasury auctioned off $58B of 3 year notes to kickoff the coupon auctions for the week, to tepid demand (I gave it an below average grade of D+). The treasury will auction 10 and 30 year coupon issues tomorrow and on Wednesday.

US stock muddled down and up and is closing modestly higher. The small cap Russell was not bothered by the higher yields and rose by0.33%. The S&P and the Dow each gained by a modest 0.19%. The Nasdaq increased by an even more modest 0.10%.

Crude oil move higher by $2.94 at $98.34.

Gold increased by $23 to $4736 while silver surged by $5.87 to $86.17 and closed at the highest level since March 10. The price also closed above the 100 day MA