This is cautiously good news for markets and for ending the Iran standoff, with signs both the Fed and Iran are moving toward buying time for a deal.

• Trump said talks with Iran are ongoing but unresolved, with a push to finish "either through a deal or another way."
• Qatar is mediating a possible last-minute deal: Iran would let weapons inspectors back in and dilute its enriched uranium under watch, in exchange for being allowed to sell oil and access frozen funds for food and humanitarian goods.
• Saudi Arabia, Turkey, Pakistan, and Qatar are all pressing Iran to accept the US proposal, and Iran's tone has turned noticeably softer, saying it still wants diplomacy to work.
• The Fed's decision to hold rates and wait for more data landed at the same time as the Iran story broke, suggesting the Fed may be giving Washington room to strike a deal without the economy getting disrupted.
• The theory is Iran has more incentive to deal before the US election, since Trump would have less reason to offer a good deal afterward.

Outlook: A breakthrough with Iran could come in the next week or so, but near-term market jitters are possible if the Fed sounds more hawkish in the meantime.