Good morning traders from a cool but brighter IntelliTrade HQ, with Amsterdam opening around 6°C under patchy sun before thicker cloud rolls in later, so pour the coffee and settle in for a pivotal midweek session.
Overall Market Sentiment:
Market mood is mixed but still cautious. Equities are rebounding on hopes the Iran conflict may wind down, with Asia posting a strong relief rally and European futures also firmer, but the move is not reading like a full return to risk-on because oil is still elevated and the dollar is still holding its defensive bid.
The bigger macro message is that markets are treating this as a partial off-ramp, not a clean reset. Brent is back above $105 after a record 64% jump in March, the dollar index is near 99.8, and Friday’s U.S. payrolls report is now the key test for whether sticky inflation fears keep crowding out Fed cut expectations.
Geopolitics:
Geopolitics remains central because the market is trying to price two things at once: the possibility of a military de-escalation and the reality that damaged infrastructure, disrupted tanker flows, and higher shipping and insurance costs could keep energy tight even if fighting eases. Brent around the $105 area is still the cleanest reference point for FX and macro, because that level keeps the inflation problem alive even as equities bounce. Assumption: markets are still pricing a slower normalization in energy flows than the headlines alone imply.
Macro Calendar
Today
- Final March manufacturing PMIs across Europe and the UK matter because they show whether factory activity is absorbing the energy shock or already starting to lose momentum.
- The U.S. ADP employment report and the ISM Manufacturing PMI are the main U.S. data points today, giving the market an early read on labor demand and industrial momentum before Friday’s payrolls.
- Overnight into Thursday in Amsterdam time, the White House says President Trump will address the nation with an update on Iran, so headline risk remains high for oil, the dollar, and broader risk sentiment.
The rest of this week
- Thursday’s U.S. weekly jobless claims are the next fast labor-market check, and they matter more than usual because markets are already focused on whether February’s weakness was noise or the start of a softer trend.
- Friday’s U.S. March payrolls are the main event. The current consensus is around 60,000 jobs after February’s surprise 92,000 decline, so a soft result would quickly revive the Fed-cut story while a steadier number would keep the dollar better supported.
- Through the rest of the week, every market will still be filtering de-escalation headlines through the oil channel, because even a ceasefire would not instantly reopen damaged infrastructure or normalize flows through Hormuz.
🔺 USD - Dollar supported, but no longer in a one-way panic bid
The dollar still has the cleanest support story among the majors. It is benefiting from safe-haven demand, the U.S. net-energy-exporter advantage, and a market that has largely priced out near-term Fed easing while oil stays high. The front end of the U.S. curve remains the main pressure point because labor data now has to be soft enough to matter more than inflation risk. Today’s ADP and ISM numbers, then Friday’s payrolls, will decide whether the current support broadens or starts to fade. Risks still lean toward a firmer dollar if oil stays elevated and U.S. data avoids a clear downside break. What would change that bias is a cleaner geopolitical de-escalation paired with weaker labor data that pulls yields lower.
🔻 EUR - Euro firmer on the day, but still exposed to the energy channel
The euro has pushed to a one-week high near $1.1565, but the broader backdrop still looks fragile. March euro zone inflation jumped to 2.5% while core eased to 2.3%, which leaves the ECB balancing higher headline prices against already-soft growth. That is not an easy mix for the single currency, because Europe remains more exposed than the U.S. to the terms-of-trade hit from energy. Markets are likely to keep watching the 1.15 to 1.16 zone in EURUSD as the near-term barometer. The bias improves if oil cools and growth fears stabilize, but as long as the energy shock stays alive the euro still looks vulnerable on rallies.
⚖️ GBP - Sterling still has rate support, but growth keeps capping it
Sterling is holding up better than the euro because UK short-end rates have repriced sharply, with the market moving from expecting cuts to pricing at least two Bank of England hikes this year. Even so, the pound is only around $1.3235 today and still posted its biggest monthly loss against the dollar in five months in March, which tells you the global energy shock is still doing damage. The core debate for GBP remains whether inflation and wages keep rates supportive or whether weaker growth and household pressure take over. Markets will keep a close eye on the 1.32 zone, with 1.30 just below as the next broader area of interest. Risks look mixed, though still slightly biased lower against the dollar if oil and USD strength keep dominating the macro story.
🔻 CAD - Oil helps, but not enough to fully offset the dollar story
CAD still has one of the more awkward setups in G10. Higher crude should help, but USDCAD is still sitting around the 1.39 area after Tuesday’s 1.3915 close and 1.3966 intraday high, because the broader flight to quality and less-friendly rate differentials are outweighing the normal oil tailwind. Canada’s January GDP rose 0.1% and the February flash estimate was 0.2%, which helps at the margin, but not enough to fully clear the growth concerns hanging over the currency. The 1.40 area in USDCAD remains the obvious reference zone.
🔺 CHF - Franc still looks like the cleaner European haven
The franc remains the cleaner defensive currency in Europe. The SNB has already said it has increased its readiness to intervene to damp franc appreciation pressure, which tells you policymakers still see haven demand as a live risk. EURCHF is the clearer lens here because Europe’s energy vulnerability keeps the euro side of the cross under pressure, while USDCHF is more balanced because the dollar is also attracting defensive demand. Near-term risks still lean toward a stronger CHF against the euro, with a more mixed picture against the dollar.
⚖️ JPY - Intervention risk is louder, even if the macro backdrop is still difficult
JPY is still caught between two opposing forces. On one side, the yen has recovered from this year’s low of 160.46 to around 158.73 per dollar, helped by stronger intervention threats and growing expectations of a possible BOJ hike in April. On the other side, higher oil prices and still-elevated U.S. yields remain a poor combination for Japan’s currency. That keeps USDJPY in a zone where official pushback matters more than usual, even if the broader macro backdrop does not yet argue for a sustained yen recovery.
⚖️ AUD - Aussie is still trading more as a risk proxy than a pure rates story
AUD is near $0.691 and is getting some support from today’s relief rally, but it is still behaving more like a risk and commodity proxy than a clean RBA currency. The RBA raised rates to 4.1% in March and signaled more tightening was possible, yet the board also stressed uncertainty around how the energy shock will hit inflation and growth. That leaves the 0.69 area as the key reference zone, with the next move still likely to depend more on oil, China-sensitive risk sentiment, and the broader market mood than on domestic policy alone.
🔻 NZD - Kiwi remains one of the clearer risk-sensitive laggards
NZD is still the softer high-beta story, sitting around $0.5737. New Zealand’s economy grew just 0.2% in the fourth quarter, inflation was already running at 3.1% in January, and officials have warned inflation could go much higher if the energy shock drags on. That is not a comfortable mix for the kiwi because it leaves the currency exposed to both slower growth and stickier prices. The 0.57 area in NZDUSD remains the key zone markets are watching, and the tilt stays soft unless global risk sentiment improves more convincingly.
Cross-asset wrap
- 🪙 Gold: Spot gold is around $4,678 after touching $4,723 earlier today, which leaves it near two-week highs but still well below January’s record extremes. The main drivers are the softer dollar on relief headlines and the ongoing tug-of-war between safe-haven demand and higher real-yield pressure. Watch next how today’s U.S. data shapes the rate story, because yields still matter more than geopolitics alone for gold here. [USD] [REAL YIELDS] [RISK]
- 🥈 Silver: XAG/USD is near $71, down from Tuesday’s rebound into the mid-$74 area and still far below the January squeeze highs. The key drivers are the dollar and yields first, with industrial demand expectations adding a more cyclical layer than gold has to deal with. [USD] [YIELDS] [INDUSTRIAL]
- 🛢 Oil (Brent): Brent is around $105.4 after a record 64% rise in March and is still holding well above pre-shock levels despite de-escalation talk. Supply disruption, tanker movement, and infrastructure damage remain the first drivers, while demand concerns stay secondary as long as Hormuz-related risks are unresolved. Watch next tonight’s Iran update and any concrete sign that physical flows can normalize. [SUPPLY] [DEMAND] [GEOPOLITICS]
- 📈 Stocks: Asia has staged a sharp relief rally, with MSCI Asia-Pacific ex-Japan up 4.3% and Europe futures up around 1.8%, while S&P 500 futures are modestly firmer after Tuesday’s rebound. The move is being driven by de-escalation hopes first, but oil is still high enough that rates and inflation fear can quickly squeeze the rally if macro data disappoints. Watch next whether today’s PMIs and U.S. data confirm stabilization or show the energy shock is already biting activity. [RATES] [ENERGY] [RISK]
- ₿ Crypto: Bitcoin is around $68,450, trading inside today’s roughly $66,001 to $68,583 range, so volatility is active but still contained relative to the wider macro backdrop. The main drivers remain dollar liquidity, real yields, and broad risk appetite, which means crypto is still behaving more like a macro-sensitive asset than a clean geopolitical hedge. [LIQUIDITY] [YIELDS] [RISK]
This is general, educational macro and FX commentary. It is not investment advice and not a trading signal.
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