Washington Edition

This is Washington Edition, the newsletter about money, power and politics in the nation’s capital. Every Monday, Bloomberg Intelligence senior analyst Nathan Dean gives his insights into what’s been happening and what’s coming up in the nooks and crannies of government and markets. Sign up here and follow us at @bpolitics. Email our editors here.

When News Breaks

I have a habit of being at the pool when big news breaks. When former President Joe Biden announced he wouldn’t run for re-election, it happened while I was at the pool. When the assassination attempt on President Donald Trump took place, the same. This past weekend? You bet, the United States launched airstrikes on Iran while I was leaving the pool.

Like many of you, I came to work seeking as much information as I could on the conflict and how it impacts markets. Let’s start with Bloomberg News, as we saw earlier today, Iran responded by launching missiles at US bases in Qatar. The Gulf state said it successfully intercepted them. Here’s the latest roundup: Trump Sees Chance to De-Escalate Mideast War After Iran Response. (And you can find more below.)

On the terminal, my colleagues Salih Yilmaz and Will Hares have a note titled Oil’s $80 Surge Unwinds as Market Hopes for Contained Fallout. They offer that market expectations are that the conflict’s impact may be limited. Bloomberg Economics’ Dina Esfandiary and Ziad Daoud say something similar with their note for Bloomberg terminal subscribers. Limited retaliation is the most likely outcome, but uncertainty remains high.

In the States, we’re seeing the Senate move forward on its tax bill. Here’s Erik Wasson with Senate Readies Tax Bill for Vote as Holdouts Threaten Delay. I’ve been telling clients I expect a Senate vote just after the Fourth of July, but based on the latests news, it feels like things may be moving faster. Its feasible votes start as soon as Thursday evening. I’m still looking for final passage in mid-July.

Also, don’t forget, Fed Chairman Jerome Powell is testifying to House Financial Services tomorrow and Senate Banking on Wednesday. He may get some tough questions from the GOP on his “go-slow” policy approach.

Tidbits

It’s hot. But if you are visiting and walking around the National Mall in this heat, there are plenty of indoor activities where you can cool off. Pretty much every Smithsonian has a decent coffee shop – my favorite is the National Art Gallery Cascade Cafe — so stay hydrated.
I saw my first Waymo near City Center in Washington two weeks ago, and now Tesla is launching their self-driving taxis in Austin. But as Bloomberg News reports, some of the robotaxis may be violating traffic laws.
My energy colleagues will be discussing ongoing geopolitical developments and the fate of US clean energy tax incentives on Wednesday on their weekly BI Energy Exchange call. It’s held at 10:00 a.m. If you’d like to attend, here’s the link. — Nathan R. Dean

War in the Middle East

Iran’s missile attack on a US air base in Qatar was telegraphed well in advance, suggesting Tehran intended a symbolic show of force while offering a way to de-escalate after US airstrikes over the weekend.

Oil plunged by more than 7% as Iran’s response to US military strikes spared energy infrastructure, allaying investor concerns that the conflict would severely disrupt supplies from the Middle East.

Decoy B-2 bombers, 125 aircraft and Tomahawk cruise missiles: How the US carried out the 37-hour operation that resulted in strikes at the Fordow, Isfahan and Natanz nuclear sites in Iran.

A B-2 bomber on the tarmac at Whiteman Air Force Base in May. Photographer: Staff Sgt. Joshua Hastings/Digital

While the US attacks have set back Iran’s nuclear ambitions and dealt its clerical regime a humiliating blow, the program hasn’t been completely destroyed.

For all of the destruction the US Air Force visited on Iran’s nuclear program, satellite images show that military planners were careful not to hit reactors at a key research facility.

Major US cities are tightening security after US airstrikes on Iran, a direct military intervention that’s deepened Washington’s role in Israel’s war with Tehran and raised concerns about potential retaliation.

Sign up for the Balance of Power newsletter for the latest political news, analysis and dispatches from around the globe.

Don’t Miss

Trump’s tax-and-spending agenda is nearing a climactic vote in the Senate as the president is juggling a pivotal week for his domestic agenda alongside a highly uncertain situation in Iran following the US strikes.

A Republican effort to block states from enacting their own artificial intelligence regulations will remain in the tax and spending package for now, marking a win for tech companies.

Previously owned home sales in the US rose slightly in May to a still-sluggish pace that continues to show a housing market constrained by poor affordability.

US states are sounding the alarm over the billions in revenue they stand to lose under the Trump administration’s broadscale government cuts and the impact of his trade policies.

Clean energy investments in the US are shrinking fast amid the rollback of tax incentives and policy uncertainties under the Trump administration, with Republican districts hardest hit.

WhatsApp has been added to a list of apps banned from government-issued devices for congressional staffers in the House because of concerns about the messaging platform’s data security.

Texas Governor Greg Abbott vetoed a bill that would have banned recreational THC products made from hemp, leaving open a loophole that has allowed sales of products that create a high similar to marijuana.

Watch & Listen

Today on Bloomberg Television’s Balance of Power early edition at 1 p.m., hosts Joe Mathieu and Kailey Leinz interviewed former Israeli Defense Minister Yoav Gallant about the US strikes against Iran and Iran’s ability to response.

On the program at 5 p.m., they talk with Leon Panetta, former US defense secretary, about how Iran may respond to the US bombing of its nuclear sites.

On the Big Take podcast, Bloomberg national security and intelligence reporter Natalia Drozdiak and Israel bureau chief Ethan Bronner join host Sarah Holder to talk through what led to Trump’s decision to strike Iran, how the surprise attack happened and what comes next. Listen on iHeart, Apple Podcasts and Spotify.

Chart of the Day

During his 2024 campaign, Trump promised to be a "peace president" and keep the US out of the wars that dogged many of his predecessors. So how does his record compare? The Reiss Center on Law and Security compiles data on the 48-hour reports submitted to Congress any time US troops are put into harm's way without advance congressional approval. By that imperfect measure, Trump has been less aggressive than most contemporary presidents. But he's still engaged the military in Syria, Gabon, Saudi Arabia, Nigeria, Yemen and now — perhaps most consequentially — Iran. — Gregory Korte

What’s Next

The Conference Board’s gauge of consumer confidence will be released tomorrow.

Trump and other leaders of NATO countries meet in The Hague tomorrow and Wednesday.

New York City’s Democratic mayoral primary is tomorrow.

New home sales in May will be reported on Wednesday.

Durable goods orders for May will be released Thursday.

Pending home sales in May also will be reported Thursday.

The Fed’s preferred inflation gauge for May, the core PCE deflator, is set for release Friday.

The University of Michigan’s final reading of consumer sentiment in June is scheduled for release Friday.

The 90-pause for Trump’s reciprocal tariffs on most counties is scheduled to end on July 8.

(Programming note: Washington Edition will be on hiatus June 30 through July 4.)

Seen Elsewhere

Despite bans and restrictions in more than a dozen states, the number of abortions in the US rose in 2024 as women seek abortion pills through telehealth appointments, according to the Associated Press.
Many companies are still pursuing sustainability goals despite backlash from politicians and investors, according to a non-profits that sets climate-action standards, the Wall Street Journal reports.
The conservative movement is drawing in young women who haven't been politically engaged through a network of wellness influencers, the New York Times reports.