Nikkei Surges Past 64,000 Yen as US-Iran Ceasefire Talks Advance

The Nikkei average rose by more than 1,000 yen on 25 May 2026, briefly touching the 64,000 yen level to set a new intraday high. The rally in Tokyo’s equity markets followed reports that negotiations between the United States and Iran towards a ceasefire had progressed. This diplomatic development also prompted a drop in New York crude oil prices, which fell to the 91-dollar-per-barrel range as investors priced in the potential for reduced geopolitical risk.

Negotiations are being mediated by Pakistan’s Deputy Prime Minister Ishaq Dar, who described the talks as having grounds for optimism. However, Iranian Foreign Ministry spokesperson Esmail Baghaei indicated that while a memorandum of understanding was being finalised to allow further discussions, there remained one or two points of disagreement. The extent to which these talks will result in a binding agreement remains unclear, with significant hurdles still present.

Adding to the complexity of the diplomatic landscape, US President Donald Trump instructed negotiators not to rush an agreement regarding the Iran situation. This directive introduces uncertainty regarding the final outcome of the talks, suggesting that while progress is being made, the administration is prioritising a measured approach over speed.

In a separate development affecting US financial governance, the US Justice Department has closed its criminal probe into Federal Reserve Chair Jerome Powell. The investigation, which concerned cost overruns on the Fed's Washington headquarters renovations, has been transferred to the Federal Reserve's Office of the Inspector General.

The closure of the Department of Justice probe removes a legal obstacle to the confirmation of Kevin Warsh, President Donald Trump's nominee for head of the central bank. US Attorney Jeanine Pirro facilitated the transfer of the matter, clearing a path for the administration to proceed with its leadership choices at the Federal Reserve.