The USD steadies, oil prices advance, equity markets are down, and US yields are mixed as Trump extends the negotiations deadline. The US Dollar holds steady as investors remain cautious after President Trump extended the Iran deadline, keeping geopolitical uncertainty elevated. Conflicting signals around negotiations continue to support safe-haven demand for the greenback. At the same time, energy-driven inflation risks reinforce expectations of a higher-for-longer Fed stance, underpinning the USD. Global equities extend their decline as escalating Middle East tensions and new China–US trade probes further dampen investor sentiment. US futures and global stocks remain under pressure, reflecting concerns over a prolonged conflict and its impact on energy supply and global growth. Rising oil prices and fears of an inflationary shock are reinforcing expectations of tighter monetary policy, keeping risk appetite subdued and markets volatile. Elsewhere, oil and gold prices strengthen, supported by geopolitical tensions and heightened safe-haven demand amid ongoing Middle East uncertainty. Meanwhile, Bitcoin weakens toward the $67,000 level as investors rotate out of risk-sensitive assets, with tighter liquidity conditions and a stronger US Dollar reducing demand for crypto. Today's focus will be on the US Michigan Consumer Expectations & Sentiment Index's and speakers from the Fed & ECB to help provide intraday direction to currency markets.
In the news. Oil hits $110 as Trump deadline extension fails to calm markets. Putin asks oligarchs to donate to budget as coast of Ukraine war soars. Trump extends deadline for striking Iran's energy plants into April. China stations jets-turned-drones at bases near Taiwan Strait, reports says. Ex-rapper Shah sworn in as Nepal prime minister after sweeping election win. Israeli military doubts war will topple Iranian regime. Bessent praised BoE as model for tighter oversight of Fed. Runway reopens at New York's LaGuardia after fatal collision. Bank of Canada says it will have a tough job tackling structural changes. Canada to lobby G7 nations to join new defence bank, foreign minister says.
In currency markets. Against the US Dollar, the Indian Rupee hits record lows, pressured by rising energy costs and geopolitical risks linked to the Middle East conflict. As a major oil importer, elevated crude prices are worsening India’s trade balance and fuelling inflation. The currency is also set for its worst fiscal performance in over a decade amid persistent capital outflows and a stronger USD. CNY holds steady, INR weakens 0.55%, and Asian currencies slip 0.15% on average against the USD. Trading currencies are mixed, with PLN & MXN weakening 0.4%, CHF, CZK KWD & ZAR retreat 0.3%, DKK down 0.1%, SEK & JPY flat, while NOK, AUD & NZD firming 0.2% against the USD.
In commodity markets. Oil prices strengthen 1.7%. Natural Gas prices strengthen 2%. Gold & Silver prices advance 1.1%. Copper prices are flat. Coffee retreated 0.4%. Soybean & Wheat prices gained 0.3%.
CAD looks vulnerable to extend losses into a fifth consecutive session, testing the 1.3900 level as investors continue to favour the US Dollar amid persistent geopolitical uncertainty. The Loonie remains pressured by broad USD strength and softer oil price support. At the same time, concerns about Canada’s growth outlook and cautious Bank of Canada messaging are weighing on sentiment. As a result, the near-term bias remains tilted higher for USD/CAD, with risk-off flows continuing to dominate.
EURCAD slips in early trading as the Euro comes under pressure while the Canadian Dollar finds relative support. Softer Eurozone data and cautious ECB messaging weigh on the single currency, reinforcing downside momentum. Meanwhile, the Loonie is underpinned by stabilising oil dynamics, helping offset broader USD-driven pressures. As a result, the near-term bias tilts lower for EUR/CAD.
EUR holds below 1.1550, remaining defensive as safe-haven demand supports the US Dollar amid persistent Middle East uncertainty. Despite tentative signs of diplomacy, markets remain cautious, keeping the greenback bid. US Michigan data adds to the backdrop, with softer consumer sentiment and elevated inflation expectations reinforcing a cautious outlook. This combination supports a “higher-for-longer” Fed narrative, keeping the near-term bias for EUR/USD tilted to the downside.
GBPEUR trades sideways near 1.1550, with limited reaction to UK Retail Sales data as it is seen as outdated. The Euro finds some support from rising inflation and ECB rate hike expectations, though energy-related pressures cap gains. As a result, the cross remains range-bound with no clear near-term direction.
GBP eases in early trading, testing the 1.3300 level despite better-than-expected retail sales data, as investors continue to favour the US Dollar. The stronger-than-expected figures offer limited support, as they are viewed as outdated relative to current geopolitical developments. The US Dollar remains underpinned by safe-haven demand and a more hawkish Fed outlook amid ongoing Middle East tensions.
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