Dollar Slide Deepens On Iran War Optimism
USD Remains Under Pressure
The US Dollar remains weak today as traders continue to move out of safe-haven positions and back into riskier assets. With optimism around the US/Iran peace-process still driving markets, oil prices have continued lower through the last 24hrs, keeping USD skewed lower while lending support to stocks and commodities. Trump signalled yesterday that fresh talks between US and Iranian officials could start within days while again reiterating his view that the war could soon end altogether. These comments have been welcomed by traders and should keep USD pressured lower near-term.
US Data & Fed Speak
Away from developments in the Middle East, USD has also been weighed on by yesterday’s weaker-than-forecast March PPI reading. The headline number held steady at 0.5%, despite expectations for a rise to 1.1% while core PPI fell to 0.1% from 0.3%, lower than the 0.4% the market was looking for. Looking ahead today focus will be on the Fed’s Beige Book release which should give some insight into how inflation pressures are impacting business conditions. We’ll also have another round of Fed speakers later in the day. Yesterday, Fed’s Goolsbee warned that rate cuts might need to be held back until 2027 in line with current inflation risks linked to the Iran war.
Technical Views
DXY
The sell off in the index has seen price breaking below the 98.24 level now fast approaching a retest of the broken bear channel highs. If we push below this area, 96.63 is the next support to watch while 99.15 remains the key pivot for bulls to overtake to regain momentum.
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