President Trump has stated that freedom of navigation through the Strait of Hormuz is a requirement for any ceasefire agreement and that the United States military will destroy Iran’s bridges and render energy infrastructure unusable if no agreement can be reached by the aforementioned deadline. Iran has it’s own requirements for what can be considered an acceptable agreement, and following their rejection of a temporary ceasefire proposal via intermediary Pakistan it appears as if negotiations have reached an impasse, making it more likely that the deadline expires. President Trump has repeatedly shifted his own deadlines over the past weeks, but has stated that it is highly unlikely that he will do so again. Iran has meanwhile continued to carry out attacks on U.S. allies, with strikes in Israel and Saudi Arabia being reported overnight. Traders will be watching for any sign of a breakthrough as we approach 8pm.

What to Watch This Week…

The complete Economic Calendar can be found here.

EUR ⇑

The Euro is up against the Greenback this morning as Europe emerges from the long Easter weekend. European Central Bank Governing Council member Pierre Wunsch stated that a series of interest rate hikes is on the table should the war in Iran last much longer, but that either way a hike by June is likely needed to combat inflation. Traders have priced in a 58.2% likelihood of rate hike in April, and a nearly 87% probability for June, making it clear that Traders are hoping that the ECB has learned it’s lesson, and will not repeat 2022.

CAD ⇓

The Canadian Dollar is down against the Buck this morning as Traders brace for developments regarding a potential ceasefire in Iran. The Loonie is being stifled as geopolitical risk dominates headlines and haven demand for the Buck leaves little room to breathe.