- Trump delays his China trip to “manage” Iran war.
- WTI oil prices give up Asia gains in early NY trading.
- The US dollar trading sideways but slightly offered
USDCAD open: 1.3696, overnight range 1.3680-1.3702, close 1.3687, WTI 95.24, Gold 5009.88
The Canadian dollar is bouncing in a narrow but well-defined range.
WTI traded in a 92.93-97.63 range, jumping on reports that Iran targeted Gulf State crude infrastructure, before sliding to 95.70 in New York.
Canada’s CPI rose a mere 0.5% in February, but the Iran conflict has already rendered the data outdated. Oil prices have surged since, and if those gains persist, they will eventually feed through into broader price pressures across the economy, though the impact is not immediate.
The Bank of Canada will review last Friday’s weak employment figures alongside the softer inflation print, but those factors are likely to be ignored. The Iran conflict provides a convenient backdrop for policymakers to remain on hold rather than adjust policy.
Trump has postponed a planned visit to Beijing and a meeting with Xi Jinping to stay focused on directing military operations in Iraq.
EURUSD traded in a 1.1466-1.1525 range, with the low printed in Asia as traders brushed aside a sharply weaker German ZEW survey. Economic Sentiment plunged by 58.8 points to -0.5 in March, largely reflecting the fallout from the Iran conflict and higher oil prices. The broader tone remains negative below 1.1590, with downside risk pointing toward 1.1410.
GBPUSD bounced in a 1.3274-1.3339 band, continuing to digest earlier losses. Price action largely mirrored EURUSD due to a lack of domestic catalysts. Heightened risk aversion tied to renewed strikes on Middle East energy infrastructure is also capping upside.
USDJPY was steady in a 159.01159.50 band, supported by elevated oil prices. Bank of Japan Governor Ueda reiterated that inflation is edging closer to the 2.0% target but still requires stronger wage growth. Those remarks, combined with ongoing intervention concerns, kept rallies in check.
AUDUSD rose in a 0.7049-0.7094 band and is hovering near the top of that range in early New York. The RBA delivered a 25 bp rate increase to 4.10%, in line with expectations. Policymakers warned that inflation risks remain skewed to the upside, a situation made worse by the impact of the Iran conflict on energy costs.
Todays US data includes Pending Home Sales
