Trump posted on social media on the 20th saying that, after recent U.S. personnel casualties, the military will carry out a strong retaliation against Iran. He warned “for every American soldier Iran kills it will pay many times over,” and said the directive has been conveyed to the Defense Secretary and Joint Chiefs chairman Caine.

U.S. Trade Representative Greer says relationship with Canadian counterpart is good.

Capital Economics says the US 10yr-2yr Treasury spread will likely narrow further over the coming months and could fully invert if tensions in the Strait of Hormuz continue to rise. The firm points to a larger increase in short-term real rate expectations than long-term expectations—potentially reflecting strong economic data—as a key driver. It expects the 2s10s curve to flatten further as markets price extra Fed hikes, forecasting 75bps of tightening over the next year versus roughly 40bps currently priced.