- IEA releases 400 million barrels of oil from reserves.
- Global equity indices under pressure
- The US dollar opens with modest gains
USDCAD open: 1.3587, overnight range 1.3577-1.3605, close 1.3594, WTI 91.15, Gold 5189.95
The Canadian dollar traded in a narrow and largely uneventful range overnight, remaining confined within familiar territory.
The US-Iran conflict that Trump described as “very complete, pretty much,” looks anything but complete. Iranian Revolutionary Guard forces appear to have missed that memo. They launched a wave of attacks on shipping in the Strait of Hormuz that reportedly left six tankers ablaze, while missiles were also fired at targets in Israel, the UAE, and Bahrain.
The International Energy Agency said it would release 400 million barrels of crude from strategic reserves, with the US contributing 172 million barrels. The goal is straightforward: keep supply flowing, prevent an oil price spike, and avoid a fresh inflation surge that would anger voters. Traders read the move differently. Rather than reassurance, the announcement suggested officials fear a lengthy disruption. WTI climbed from yesterday’s low of 81.82/b to 91.57/b today.
Meanwhile, Trump continues to expand the list of economic flashpoints. US Trade Representative Greer has opened Section 301 investigations into 16 trading partners including China, the EU, Mexico, and Japan. The process takes time, but if the findings support the case, it gives Washington the authority to impose tariffs on countries deemed to have policies that are “unreasonable, discriminatory, or restrictive” toward US commerce.
Yesterday’s US inflation report matched expectations at the headline level, but several underlying components accelerated more than anticipated. That detail strengthened the argument for leaving interest rates unchanged at next week’s FOMC meeting.
Rising oil prices unsettled Asian equity markets. Japan’s Topix dropped 1.32%, Australia’s ASX 200 fell 1.31%, and Hong Kong’s Hang Seng declined 0.70%.
As of 7:20 am, the French CAC 40 is down 0.53%, the FTSE 100 has lost 0.44%, and the German DAX is flat. S&P 500 futures have dropped 0.51% and the US 10-year Treasury yield is 4.22%.
EURUSD traded in a 1.1532–1.1575 range and drifted sideways as traders took direction from swings in oil prices and global equities. With the Eurozone data calendar empty, there was little domestic influence. The technical backdrop remains bearish below 1.1690, and a sustained break under 1.1485 would expose the 1.1380 area.
GBPUSD had a slight bid tone as it traded in a 1.3361–1.3416 range and held steady as markets weighed the inflation implications of higher oil prices. UK inflation already sits above the Bank of England’s target, and an extended energy rally could push policymakers toward a more hawkish stance.
USDJPY climbed in a 158.67–159.24 range before easing back toward 158.81 in early New York trading. The advance was driven by rising energy prices despite the IEA’s decision to release 400 million barrels from reserves. Currency traders showed little concern about the risk of Bank of Japan intervention.
AUDUSD traded uneventfully in a 0.7111–0.7161 band and edged lower on broader US dollar strength. The downside was tempered after Australian consumer inflation expectations rose to 5.2% in March from 5.0% previously, reinforcing speculation that the Reserve Bank of Australia could deliver another rate hike next week. The currency is trading near levels last seen in February 2023.
