**Ongoing U.S.-brokered direct talks and a June 2026 trilateral framework agreement have advanced security arrangements between Israel and Lebanon, including IDF withdrawal from southern Lebanon, Lebanese Armed Forces deployment, and Hezbollah disarmament steps, but these fall short of full diplomatic and economic normalization.** A April 2026 ceasefire and subsequent Washington negotiations produced the June 26 framework, which affirms mutual rights to exist in peace and commits the parties to further talks on a comprehensive agreement. However, Lebanese officials, including the prime minister, have repeatedly stated that the country remains “far from” diplomatic normalization or economic ties, citing domestic opposition, Hezbollah’s residual influence, and linkage to the broader Arab Peace Initiative requiring progress on Palestinian issues. Public polling in Lebanon shows limited support for normalization, and implementation of even the security provisions faces logistical and political hurdles. With only months remaining until 2027, traders see these developments as advancing conflict management and de-escalation rather than the deeper bilateral recognition and relations implied by normalization. Barriers such as Lebanese constitutional and political constraints, plus the need for sustained disarmament and border stability, keep the implied probability of “No” elevated at 89.5%.