Trump Countdown: Dollar Drops, Markets Await Clarity
The US dollar weakened against most major currencies and oil prices retreated from session highs, as investors counted down to President Donald Trump's Tuesday (April 7) deadline for a deal with Tehran. The Bloomberg Dollar Spot Index reversed from a 0.2% gain to a 0.2% decline, amid market assessments of Trump's insistence that any deal must ensure smooth transit through the Strait of Hormuz.
Axios reported that mediators from Pakistan, Egypt, and Turkey are working to prevent attacks on Iranian infrastructure by pushing for a deal—or at least extending the negotiation period. Options sentiment remained relatively stable, while the 10-year US Treasury yield held at 4.33%. JPMorgan's 1-month G-10 volatility gauge was also steady at 7.98%, and daily volatility in major currencies remained below recent peaks.
In the G-10, EUR/USD rose 0.2% to 1.1568. In Europe, EUR/SEK strengthened 0.5% to 10.9525 after Swedish core inflation slowed to its weakest pace in more than four years, reinforcing expectations of a continued pause from the Riksbank. EUR/GBP was relatively flat at 0.8720. USD/JPY fell 0.1% to 159.58 from a session high of 159.93, amid concerns of war fatigue and the risk of Japanese intervention. Japanese Prime Minister Sanae Takaichi said she was still pursuing talks with Iranian President Masoud Pezeshkian and a call with Trump. AUD/USD rebounded 0.3% to 0.6936 after the S&P Global Australian services PMI fell to 46.3 from 52.8.
The main market catalysts now are developments in negotiations ahead of Tuesday's deadline, official signals regarding Hormuz, and the response of oil and FX volatility to fragile liquidity conditions.
Source: Newsmaker.id
