North American Summary and Highlights 26 Mar
Overview - The USD was modestly stronger with Middle East tensions increasing.
European and North American sessions
After being fairly directionless in the European morning, the USD advanced modestly in North America with markets still focused on the Middle East, in particular risk that Trump suggested, of further military action against Iran if it does not agree to his peace terms. Oil advanced, equities struggled and bond yields rose, particularly at the front end. USD/JPY moved above 159.80 from 159.50, and EUR/USD fell to 1.1525 from 1.1560. AUD/USD fell below .69 from .6950 while USD/CAD rose above .1.3850 from 1.3825.
EUR/GBP was little changed after reversing a modest dip but EUR/CHF advanced to .9165 from .9150 and EUR/SEK rose to 10.88 from 10.82. Norges Bank left rates unchanged but switched to a hawkish from a dovish bias. EUR/NOK however largely reversed European losses ending only marginally weaker at 11.18 from 11.22. US initial claims were at expected at 210k from 205k, but continued claims were lower than expected at 1.819m from 1.851m. Later March’s Kansas City Fed manufacturing index increased to 11 from 5.