The US and Iran have reportedly been in productive discussions regarding the resolution of the Iran conflict, which threatens global energy supplies. President Trump announced on social media that the two countries had had "very good and productive conversations" about resolving the issue, which led to a surge in risk assets for risk assets. However, Iranian media denied direct negotiations were underway and called these statements "psychological warfare". Despite mixed evidence on the legitimacy of these discussions, the S&P 500 was up 2.1% and global bond yields fell as investors priced in less inflation and less risk of central bank rate hikes. The surge in markets appears to be due to relief at the apparent indication that the US is taking an off-ramp rather than escalating the situation further.