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U.S. President Donald Trump speaks to reporters aboard Air Force One after departing early from the the G7 summit in Canada to return to Washington, June 17, 2025. Kevin Lamarque | Reuters

Taken from CNBC’s Daily Open, our international markets newsletter — Subscribe today

Hopes of a quick ceasefire between Israel and Iran were dashed by several social media posts from U.S. President Donald Trump. As he took an early departure from the Group of Seven summit, Trump said it “certainly has nothing to do with a Cease Fire” and that he was involved in something “much bigger than that.” What’s bigger than a ceasefire? An escalation in conflict on the prospect of the U.S. joining the hostilities in the Middle East. Trump, on his social media platform Truth Social, threatened Iran’s leader Ayatollah Ali Khamenei that he is an “easy target” and wants him to “surrender.” Trump’s posts on Truth Social brought U.S. stocks lower and caused oil prices, which were on the retreat Monday, to shoot up more than 4% during Tuesday’s trading session. A weaker-than-expected U.S. retail sales report in May also added to the heavy sentiment in markets. The U.S. Federal Reserve’s rate-setting meeting will conclude Wednesday. While central bankers are expected to leave interest rates unchanged, the committee will release updated projections of where they see rates going. Chair Jerome Powell will also answer questions from the media at this press conference. All of those are market-moving events — so it’s a relief, at least, they come from official communiques.

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And finally…

Federal Reserve Chair Jerome Powell delivers remarks during the Division of International Finance 7th Anniversary Conference at the Fed on June 02, 2025 in Washington, DC. Chip Somodevilla | Getty Images

The Fed is likely to keep rates the same but give a forecast that moves markets. What to expect While any immediate movement on interest rates seems improbable, the Federal Reserve’s policy meeting, which concludes Wednesday, will feature important signals that still could move markets. Among the biggest things to watch will be whether Federal Open Market Committee members stick with their previous forecast of two rate cuts this year, how they see inflation trending, and any reaction from Chair Jerome Powell to what has become a concerted White House campaign for easier monetary policy. As things stand heading into the meeting, markets are pricing in the next cut to come in September, which would be the one-year anniversary of a surprisingly aggressive half-percentage-point reduction the FOMC instituted amid concerns over the labor market. The committee added two more quarter-point moves by the end of the year and has been on hold since.