The Morning Update

The USD eases, oil prices ease, equity markets & US yields are mixed as the US & Iran receive a peace proposal. The U.S. dollar eases in early trading after reports that the U.S. and Iran have received a new peace proposal that could pave the way for a broader agreement within 15 to 20 days. The proposal outlines an initial ceasefire followed by negotiations toward a comprehensive settlement, boosting hopes for de-escalation in the Middle East. However, markets remain cautious as uncertainty persists around whether both sides will accept the terms and follow through. As a result, the dollar’s pullback appears tentative, with safe-haven demand likely to return quickly if negotiations falter. Global equities are mixed, with U.S. futures ticking higher on tentative hopes of a ceasefire, while trading remains subdued under thin holiday conditions. The modest rebound reflects cautious optimism, as investors react to headlines suggesting potential de-escalation in the Middle East. However, sentiment remains fragile, with ongoing geopolitical uncertainty limiting conviction in the upside. Elsewhere, oil prices slip as markets reassess supply risks and de-escalation prospects in the Middle East. Meanwhile, gold and bitcoin are rallying on renewed demand for alternative and safe-haven assets amid ongoing uncertainty. With a quiet economic calendar, markets will focus on the ISM Services PMI for intraday direction in currency markets.

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News Headlines. US & Iran receive peace proposal as Trump vows 'hell' if Strait stays shut. EU warns capitals against turning energy crunch into fiscal crisis. Power-starved Cuba deepens reliance on Chinese solar tech. Russia's key Black Sea oil terminal is on fire. China & Europe launch a rare joint space mission. UAE says the use of Hormuz must be guaranteed in any US-Iran deal. Oil shock is adding stress to the global economy. Taiwan opposition leader to visit China as Beijing ramps up 'reunification' push. Germany works to clarify new rules on fighting-age men leaving the country. Spanish PM's party gains on anti-war stance, support for far right stalls.

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In currency markets. Markets are expected to be quiet, with many European markets closed for the Easter Monday holiday. Against the U.S. dollar, the Japanese yen remains under pressure near 160, close to multi-month lows. Authorities have stepped up warnings about intervention, but markets remain skeptical given strong safe-haven demand for the USD. With speculative short positioning building, the yen remains vulnerable near key intervention territory. CNY is flat, while Asian currencies firm by an average of 0.2% against the USD. Trading currencies rebound, with KWD & JPY flat, CHF & NOK up 0.1%, DKK & CZK firmed 0.25%, ZAR, SEK, MXN, & PLN gained 0.45%, while AUD & NZD strengthened by 0.8% against the USD.

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In commodity markets. Oil prices eased 0.5%. Natural Gas & Copper prices rallied 1.5%. Gold price strengthened 0.9%. Silver prices advanced 0.6%. Coffee prices are flat. Wheat prices weakened 0.1%, and Soybean prices are up 0.3%.

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CAD edges off multi-month lows as USD softens on improved sentiment around potential US-Iran ceasefire talks. However, gains remain limited as easing oil prices and reduced energy shock risks temper expectations for a more hawkish Bank of Canada. With geopolitical developments still in focus, investors will also be focusing on Tuesday’s Ivey PMI and Friday’s Canadian jobs report for further direction.

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EURCAD gains in early trading, supported by weaker oil prices that are weighing on the loonie. The move is driven by policy divergence, with a relatively hawkish ECB contrasted against a more cautious Bank of Canada. As a result, the cross remains biased higher, underpinned by stronger euro fundamentals.

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EUR advances, retesting the 1.1550 level as easing U.S. dollar strength and renewed optimism around a potential US-Iran ceasefire support the pair. The move is driven by improving risk sentiment, although gains may be tempered by thin liquidity conditions due to holiday trading. While near-term momentum has improved, the broader outlook remains cautious, with key U.S. data likely to guide the next directional move.

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GBPEUR edges through the 1.1450 level, with the pound gaining modestly in cautious market conditions. The euro remains supported by firmer inflation and expectations of ECB tightening, limiting sterling’s upside. As a result, gains in GBP/EUR remain constrained amid policy divergence and ongoing geopolitical uncertainty.

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GBP rebounds, with the pound rising to 1.3250 as improving risk sentiment weighs on the U.S. dollar. The move is driven by optimism about a potential Middle East ceasefire, which is reducing safe-haven demand. However, gains may be limited as ongoing geopolitical uncertainty and elevated oil prices continue to support the dollar.