Trump weighed strikes on Yemen Houthis before holding off: Axios

U.S. President Donald Trump reportedly considered launching military strikes against Houthi targets in Yemen over the weekend but ultimately decided against proceeding, according to Axios. This development comes amid escalating tensions in the Yemen civil war, where the Iran-backed Houthis are fighting against Yemen’s internationally recognized government and Saudi-led forces. The conflict, which began in 2014, had seen a period of relative calm following a UN-brokered truce in 2022 before renewed fighting erupted in 2026. The consideration of strikes by the U.S. indicates a potential shift in its level of involvement, which could have broader implications for regional stability and the dynamics of U.S.-Iran relations.

Key Takeaways

• Market pricing suggests that Trump’s decision to hold off on strikes may indicate a focus on maintaining regional stability rather than pursuing regime change in Iran.
• The probability of the Iranian regime falling by the end of 2026 appears to have decreased, with the current pricing indicating a 6.5% chance, down from 8% a week ago.
• Market participants appear to view the U.S. restraint in Yemen as consistent with scenarios where the Iranian regime remains stable.

What to Watch

Observers should monitor any further statements or actions from the Trump administration that could suggest changes in U.S. military strategy in Yemen. Additionally, developments in the Iran-backed Houthi conflict and any shifts in Iranian internal dynamics could impact market perceptions of regime stability. The coming weeks may see fluctuations in the pricing of related markets, especially if new escalations or diplomatic actions emerge.

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Disclosure: This article was edited by Estefano Gomez. For more information on how we create and review content, see our Editorial Policy.