North American Summary and Highlights 2 Apr
Overview - The USD remained firmer after Trump’s Wednesday speech but edged off its highs in part due to Iranian claims that it was working with Oman to allow traffic through the Strait of Hormuz.
European and North American sessions
Disappointment with Trump’s speech late on Wednesday, which lifted oil and the USD in Asian hours, remained the dominant theme in European and North American trading, though the USD came of its highs in North American trade. A claim from Iran that it was working with Oman (which occupies the other side) to draft a protocol for traffic through the Strait of Hormuz caused a brief dip in oil and helped equities come off early lows, as well as assisting a reversal of gains in UST yields.
USD/JPY extended gains above 159.70 in Europe and largely recovered from a modest dip in North America. AUD/USD, after falling as low as 0.6860, moved back above .69, and with USD/CAD relatively stable near 1.3920, AUD/CAD rebounded back above .96 leaving it near levels seen before Trump’s address. EUR/USD found support near 1.15 but the recovery failed to hold above 1.1550. Moves in EUR/GBP and EUR/CHF were modest.
US data got little attention but was on the firm side, initial claims falling to 202k from 211k and a February trade deficit of $57.3bn only marginally above January’s $54.7bn and detail showing strong gains in both exports and imports. In separate news, Trump sacked Attorney General Pam Bondi.