U.S. President Donald Trump said on Monday the U.S. has had good and productive conversations with Iran and he will order the military to postpone any military strikes against Iranian power plants and energy infrastructure.

The dollar plunged and stock and bond prices surged following the news.

KENNETH BROUX, HEAD OF CORPORATE RESEARCH FX AND RATES, SOCIETE GENERALE, LONDON:

"This confirms what the head from the IAEA has been saying over the weekend, that discussions were taking place between both sides.

"So, the question is does he (Trump) drop the deadline of 00:45 CET to re-open the Strait of Hormuz?"

"Buy the front end in bonds!"

CHRIS BEAUCHAMP, CHIEF MARKET ANALYST, IG MARKETS, UK:

"This is obviously a postponement, not a complete cease-fire and we will see what happens from here."

"What's done is still not undone, so the impact has yet to be seen. But obviously markets are breathing a sigh of relief on these news."

ELIAS HADDAD, GLOBAL HEAD OF MARKETS STRATEGY, BROWN BROTHERS HARRIMAN, LONDON

"It's clearly jaw boning in the face of the meltdown that we've seen. We're seeing a bit of a knee-jerk reaction to this positive news. If it's a legitimate de-escalation, we could see a bit more of a relief rally in risk assets."

"It's still hard to say whether this is just political jaw boning or a legitimate de-escalation in this crisis. There's certainly room for a bit of an unwind in the fear trade. A more sustained rally in risk assets will depend on whether this is legit de-escalation or simply a pause before a next leg up in escalation."