U.S. Treasury Secretary Bessent is going back to Washington, D.C., to testify before Congress. In his absence, Greer and Lutnick will continue trade discussions. These discussions have been productive, and will keep going as needed. However, Bessent’s departure raises questions about the talks’ progress. Bessent’s return to Washington might change the pace of discussions. Greer and Lutnick will handle negotiations, but they don’t approach decision-making like Bessent does. This could lead to adjustments in expectations among those involved. With Bessent away, some issues might take longer to resolve, especially those needing Treasury approval or clearer policies. Market players should adjust their expectations. Describing the talks as “productive” indicates some progress, but not a complete resolution. While discussions continue, not having Bessent might pause the tone of conversations. We shouldn’t expect sudden changes in the next few weeks. This situation favors a patient strategy rather than hasty reactions. Traders dealing with interest-sensitive instruments or leveraged positions may need to revise their timing assumptions. It’s not just about where markets are going, but also when full communication will resume. Greer and Lutnick provide continuity but can’t control timing or legislative outcomes as Bessent can. This suggests a lower chance of short-term political triggers, even as market pricing remains influenced by expectations. For now, volatility is stable. However, this calm hides timing uncertainties. Those focusing on duration bets or anticipating updates on Treasury issues should consider how much time Bessent needs once he returns to Congress. This transitional period might stretch reaction times, leading liquidity providers to widen spreads or reassess premiums. It’s not a disruption, but a delay. Nuances matter. Those managing derivatives across yield curves and basis trades should revisit any assumptions that depend on clear forward guidance. We’re currently in a phase of steady management—not drifting, but slow progress. This requires careful attention to how quickly we reach conclusions, rather than just the direction we’re heading. In summary, decision delays may not happen in order. The trade desk should lean towards expectations of delayed resolutions and staggered responses rather than quick actions. We continue to engage, but without assuming things will happen immediately.

here to set up a live account on VT Markets now