Trump Meets Xi as Iran Threats Spike Oil and Yields

Global financial markets experienced severe volatility on September 24, 2026, as geopolitical tensions and strong economic data pushed U.S. 10-year Treasury yields above 5% and 30-year yields to their highest levels since 2004. Donald Trump contributed to the instability by threatening to "annihilate" Iran during an address to the United Nations General Assembly, though he later suggested a deal might be possible after the November midterm elections. These threats, combined with warnings from Iranian Major General Yahya Rahim Safavi that conflict could expand to the Indian Ocean, pushed Brent crude prices above $100 per barrel.

In a diplomatic shift, Trump greeted Chinese President Xi Jinping at Joint Base Andrews for a summit to discuss trade, artificial intelligence, and Taiwan. U.S. Treasury Secretary Scott Bessent announced that the two nations agreed to extend their trade truce until January 10, 2027. Trump described the progress as "tremendous strides" as the leaders began their discussions.

Market pressure intensified as Federal Reserve officials, including New York Fed President John Williams, signaled that further interest rate hikes this year were a reasonable possibility to combat persistent inflation. While the U.S. Treasury Department attempted to stabilize the bond market with a $6 billion buyback, equities in the U.S., Europe, and Asia generally declined. Late-day volatility eased slightly following reports that negotiators were exploring a phased deal to reopen the Strait of Hormuz in exchange for the U.S. lifting its economic blockade of Iran.