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Geopolitical Score 88 Neutral

US Extends Iran Ceasefire Amid Continued Strait of Hormuz Blockade

Apr 21, 2026 13:57 UTC
CL=F, TLT, GC=F
Immediate term

President Donald Trump has extended a truce with Iran following the collapse of peace negotiations. While the ceasefire provides temporary relief to markets, the strategic blockade of the Strait of Hormuz remains in effect.

  • Ceasefire extended just before the previous two-week window expired
  • Peace negotiations between the US and Iran have been scrapped
  • Strategic blockade of the Strait of Hormuz continues
  • Treasury yields declined from session peaks following the announcement
  • Market remains sensitive to both geopolitical tensions and Fed leadership changes

US Treasury yields retreated from their session highs on Tuesday after President Donald Trump announced an extension of the ceasefire with Iran. The move provided immediate relief to traders who were bracing for the expiration of a two-week truce. The extension comes in the wake of failed peace talks that were intended to permanently resolve the conflict between the two countries. Despite the agreement to avoid active hostilities, the administration confirmed that the blockade on the Strait of Hormuz—a critical chokepoint for global energy shipments—will remain in place. Market participants reacted to the news with a reduction in the sell-off of government bonds, as the immediate threat of a wider military escalation subsided. However, the decision to maintain the blockade ensures that geopolitical risk remains embedded in energy pricing and global supply chain forecasts. This volatility occurs as the market also focuses on the Federal Reserve, with Kevin Warsh scheduled to testify regarding a potential role as Fed Chair, adding another layer of scrutiny to the fixed-income landscape.

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