Global markets jump on deal hopes
The US dollar reversed sharply overnight after touching ten-month highs. US shares surged, with the S&P 500 up 2.9% in its best session since May last year.
The mood was boosted on reports US President Trump is open to ending the conflict with Iran without forcing the reopening of the Strait of Hormuz.
The Wall Street Journal reports that Trump believes pushing to reopen the route would drag the conflict beyond his preferred four- to six-week window.
Instead, Trump wants to degrade Iran’s naval and missile capabilities before seeking a ceasefire and leaning on diplomacy to revive trade.
If that approach fails, the US would pressure Europe and Gulf allies to take the lead in reopening the strait. Military options remain available, but they are not the administration’s immediate priority.
USD lower in Asia
The USD turned sharply lower in Asia overnight.
USD/SGD reversed from levels above 1.2900. On the downside, the next areas of interest sit near the 100-day average at 1.2810 and the 21-day average at 1.2804.
These levels may attract demand from USD buyers looking to add on dips.
Meanwhile, USD/CNH also reversed, falling 0.5% as it slid back to one-week lows.
RBA warning lifts AUD/USD
The Australian dollar moved higher following yesterday’s release of the Reserve Bank of Australia minutes.
The RBA said a prolonged Middle East conflict could weigh on both growth and inflation. It warned that if oil prices climb to USD100 a barrel, headline inflation could rise to around 5% year on year in Q2. That scenario may force the central bank to act if inflation expectations continue to drift higher.
The RBA also cautioned that fresh supply-chain disruptions would add to the pressure.
For now, policymakers stopped short of making any firm calls on interest rates.
AUD/USD rebounded from two-month lows, gaining 0.7%. The next areas to watch higher sit near the 50-day average around 0.6965, followed by the 21-day average near 0.6984.
Greenback reverses from ten-month highs
Table: seven-day rolling currency trends and trading ranges
Key global risk events
Calendar: 30 March – 3 April
All times AEDT
Have a question? [email protected]
*The FX rates published are provided by Convera’s Market Insights team for research purposes only. The rates have a unique source and may not align to any live exchange rates quoted on other sites. They are not an indication of actual buy/sell rates, or a financial offer.
