The USDCAD edged to a marginal new high for the year—stretching just a pip beyond the January 23 peak to 1.3755 (vs. 1.3754)—before quickly running into resistance. From there, price action reversed sharply following the Trump Truth Social headline, triggering a swift move lower.That downside momentum carried the pair into a key confluence zone, including the 200-hour moving average at 1.3687 and swing lows from March 17 and 18 (1.3679–1.3687). The decline stalled at 1.3685, where buyers stepped in to stabilize the move.Since then, price has settled into a more two-way, rotational pattern. The pair is now oscillating around the 100-hour moving average at 1.37165, which sits within a broader swing area between 1.37149 and 1.3724. This zone is emerging as the near-term pivot and will serve as the key barometer for directional bias.Above 1.37149–1.3724: Buyers gain control, with a retest of the 1.3754–1.3755 highs as the next upside target. Below 1.37165: Sellers regain momentum, shifting focus back toward the 200-hour moving average near 1.3683. This article was written by Greg Michalowski at investinglive.com.

Gold briefly traded flat on the day at $4480 after falling as low as $4100. It's since slipped again and is down $50 to $4440.It's an incredible move in an asset that's now trading off of energy and economic shock narratives. The fear is that a prolonged shock and +$150 oil with shortages leads to a global recession in a stagflatioary period. That cut the legs out of gold and pushed sovereign yields much higher.That sort of scenario might have been impossible to avoid if energy infrastructure and desalization in the gulf was destroyed.With Trump announcing talks, it indicates that he won't go so far as to destroy energy, as he'd threatened to do. There was always the sense in markets that he wouldn't go too far but there now a fear that hardliners are in control in Iran.The question now is: What happens if the US stops bombing Iran. Will they allow the reopening of Hormuz or will they want something in return? Iran has been severely bombed but it does hold energy leverage and is asking for compensation and security guarantees. As for the price action, a close back above $4400 would indicate a false breakdown in the chart as that's an important level. At the moment, we're looking for signs of real talks or the parameters of a real peace. Given Trump's personality, he needs to credibly have a 'win' on this conflict and that might just be a self-proclamation that "Iran won't get a nuke" but that needs to be engineered in the right way.The other party to watch is Israel, who reportedly bombed Iran's infrastructure last night. They seem far less eager to walk away from this conflict and it's not clear that Trump could pull the plug on their operations. This article was written by Adam Button at investinglive.com.

Deal with Iran could be in 5 days or soonerNot sure what Iran's media is talking about (regarding no talks)Talks with Witkoff, Kishner and their counterpartsThe market likes what its hearing and is willing to bet on a deal. This article was written by Adam Button at investinglive.com.

From Axios reporter Barak Ravid:Turkey, Egypt, and Pakistan have been passing messages between the U.S. and Iran over the past two days in an effort to de-escalate, U.S. source saysSenior officials from the three countries held separate talks with White House envoy Steve Witkoff and Iranian Foreign Minister Abbas Araghchi, the U.S. source says"The mediation is ongoing and making progress. The discussion is about ending the war and resolving all outstanding issues. We hope to have answers soon," the source saysI tend to think Ravid as a mouthpiece for the White House in this war.The important thing here is that he's trying to establish that there were actually talks. That said, it doesn't really push back on the idea that others contacted Iran and they said, "the US needs to stop first".Now the substance of these talks from the Iran side is still less important than going from 'bombing power plants' to 'the US (at least) wants to talk". We've taken some big tail risks off the table here and might be getting actual progress.At the same time, Iran's comments that Trump wants to calm markets and buy time for more war is also valid. The US started the war during negotiations so Iran -- rightly or wrongly -- thinks all negotiations are a ruse. There's also the reality that US marines will be arriving in the region in the next day or so. This article was written by Adam Button at investinglive.com.

It's an intense moment, there is a lot hanging in the balanceI dissented last year because we didn't not have the data that inflation was going awayThis definitely throws a wrench into plans to cut ratesThe Fed funds futures market is pricing in about a 30% chance of a rate hike this year.Miran also speaking:POlicy outlook remains for rate cutsPulled back his dots to pencil in four cutsJob market is continuing gradual softening trendIt would be highly unusual for the Fed to react to the oil shock nowStill not enough clarity to know mon pol should react to current events This article was written by Adam Button at investinglive.com.

Headlines:Big turn in markets as Trump delivers another TACO momentRisk appetite returns with a bang as Trump trades missiles for peace talksIran media reportedly says there has been no direct or indirect contact with TrumpUAE resumes operations at its largest gas processing facility after shutdown last weekECB's Kazimir: Will not hesitate to act if inflation was at risk of staying above targetJapan's largest union group Rengo sees average wage hike of 5.26% this fiscal yearMarkets:WTI crude oil down 5% to $92.97 currently, after falling from $100 to $84 on the headlinesUS 10-year Treasury yields down 1 bps to 4.38% currently, after falling from 4.44% to 4.31%S&P 500 futures rebound strongly to be up 1.3% on the day, was as low as down 1% earlierEuropean stocks turn losses to gains, DAX down 2% at the start of the day but is now up 1.1%EUR/USD moves up from 1.1490 to 1.1615 before falling back to 1.1560 nowAUD/USD jumps from 0.6920 to 0.7045 before falling back to 0.6985 nowGold jumps from low of $4,100 to $4,383 but still down 2% on the dayYou gotta love a good TACO moment, no?The start of the day is now but a thing of the past as everything else before the last hour does not matter anymore. In fact, anything since the weekend pretty much does not really matter.We've finally reached a point where US president Trump has hit the pain threshold for the Middle East conflict. He announced a five-day postponement to strikes on key Iranian facilities, that after supposed "talks" over the weekend between the two countries.Markets saw a momentous turnaround in sentiment, after having been bleeding on all fronts earlier in the day. It was a buy dollar, sell everything else mood in returning from the weekend. And on Trump's headline alone, we saw the complete opposite happen in stunning fashion.However, the optimism was quick to be tempered with after Iran's local media said that there have been no "talks" whatsoever between the two sides. And they even went as far to air that Trump has retreated because of Iran's own "decisive threats". So, make of that what you will.WTI crude oil was up around $100 before all this and then fell to a low of $84.30 on Trump's remark. However, we're seeing price rebound back now to $93 - down just about 5% on the day.In other markets, S&P 500 futures had a rough one and was down around 0.8% earlier in the day. That before a surging rebound to post gains of 2.8% after Trump's comment and then now seeing those gains halved to just 1.3%. It is the same for European stocks as well, with the DAX having traded down by nearly 2% at the open before posting gains of 2% instead. But now that optimism is tempered with, the DAX is seen up 1% on the day.The US dollar was another big mover and is still swinging around amid the volatile environment. EUR/USD jumped up from 1.1490 to 1.1615 before falling back now to 1.1560 on the day. Meanwhile, AUD/USD was also down in the dumps earlier as it was struggling at 0.6920 before a surging rebound to 0.7045. But now, it is trading back down by 0.4% to 0.6990 levels.The wild swings continue in other markets too, with 10-year Treasury yields falling from 4.44% to 4.31% before rebounding back to 4.38% now. Meanwhile, gold was down to a low of $4,100 earlier in the day before a surging bounce to $4,463 but is now back down by over 2% to $4,383.Whether true or not, the key thing is that Trump has put out a signal that he has arguably reached his limit on this war. And that means we might not see much material escalation like we have in the weeks prior. That as he continues to keep a close watch on markets too.In any case, the only thing that really matters is what happens now with the Strait of Hormuz. That will have the final say on how markets should react regardless of the noise we're seeing. This article was written by Justin Low at investinglive.com.

The Pres. Trump Truth Social post regarding good and constructive talks with Iranian officials reversed oil price with the price moving from a high of $101 to a of $84, saw US yields move lower with the 10 year moving from 4.44% to 4.31%, and saw the US stocks move from being down around -0.80% in the S&P to up 2.5% in pre-market trading. The USD moved sharply lower as well with the dollar index moving from 100.148 to 99.128 ( 1% decline). Since than there has been a rotation the other way again as traders ponder the truthfulness of the Truth Social post. Is Trump TACOing (just chickening out as stocks and oil hurt him politically), or TrOLl-ing (TRump Only Lies because stocks and oil are moving lower). It is hard to say. You hope for peace, but wonder what is the truth. Who are the leaders they are talking to? Or is it just a repeat of Hammas and Isreal where peace really isn't peace - it is just a pause. Of course, the opening of the Strait of Hormuz is the proof to the war calculus. If it opens peacefully, there is hope. If it does not, the hope for peace is not done. The war will continue. IN the video above, I take a look the EURUSD, USDJPY and GBPUSD from a technical perspective and outline the key levels in play given the volatile moves first higher in the USD, then lower and now back higher. This article was written by Greg Michalowski at investinglive.com.

Iran's Tasnim news agency reaffirms that "there are no talks", adding that US president Trump's latest comments on the Middle East situation are all part of "psychological warfare". That as the outlet cites a senior Iranian security official. At the same time, the official says that the Strait of Hormuz "will not return to pre-war conditions" so long as this "psychological warfare" continues.At the same time, we're also getting headlines now that Israel is conducting strikes in the heart of Tehran. So, is there really any material de-escalation?Besides that, Iran's foreign ministry is also stating that there have been no talks with Washington and is accusing Trump of buying time in a bid to allow regional de-escalation efforts to materialise.Whether it is true or not, the thing is all of this is out there now. And the key takeaway for me is that Trump has signaled where his pain threshold for markets is. And in other words, where his pain threshold for this war is.He's looking for some way to put down the flames of war and that's the biggest signal I would say. It means that we might not see a material escalation in the war rhetoric compared to what we've seen in the past few weeks. He knows that it just won't work if they continue like this. So, he's trying to propose a different solution.But as mentioned before, the only thing that really matters now is what happens on the ground or should I say with the waters in Hormuz. Is it open? Or is it still in de facto closure? That is the main thing to keep an eye out for here. This article was written by Justin Low at investinglive.com.

FUNDAMENTAL OVERVIEWThings were looking pretty dire for the S&P 500 just an hour ago as Trump’s ultimatum to Iran was keeping traders on edge for fears of further escalation. That’s now history though as Trump’s ceasefire announcement on Truth Social turned markets around quickly on expectations of a potential end to the conflict. The downside for now will likely remain limited but the risk that this is just Trump jawboning markets again might also cap the upside. In fact, the Iranian side is saying that there were no direct or indirect contacts with the US.US-Iran headlines will continue to drive the price action, so traders will need to stay laser focused and be nimble to adjust their positions.S&P 500 TECHNICAL ANALYSIS – DAILY TIMEFRAMEOn the daily chart, we can see that the S&P 500 probed below the November lows and reversed strongly after Trump’s ceasefire. We can expect the sellers to step in around the resistance at 6,760 where we have also the confluence of the major trendline. The buyers, on the other hand, will want to see a breakout to increase the bullish bets into new all-time highs. S&P 500 TECHNICAL ANALYSIS – 4 HOUR TIMEFRAMEOn the 4 hour chart, there’s not much we can add as the sellers will likely step in around the resistance to target a drop back into the 6,530 support, while the buyers will look for a breakout to pile in for new highs.S&P 500 TECHNICAL ANALYSIS – 1 HOUR TIMEFRAMEOn the 1 hour chart, we can see that the price is trading much above the upper bound of the average daily range for today. This shouldn’t be surprising given the importance of Trump’s post. In such instances though, we can generally see some consolidation or a pullback before the next move.UPCOMING CATALYSTSTomorrow we have the US PMIs. On Thursday, we get the latest US Jobless Claims figures. As a reminder, the focus is mainly on the US-Iran war, so keep an eye on the headlines. This article was written by Giuseppe Dellamotta at investinglive.com.

Iran's local media is not offering any confirmation to Trump's comments it would seem. This via key energy market correspondent and head of Kpler's energy market and OPEC+ intel, Amena Bakr, on Twitter/X. She is a well reputable source in the oil market for all things, so just be aware of the situation here. The tweet:"IRANIAN MEDIA SAYS THERE WAS NO DIRECT OR INDIRECT CONTACT WITH TRUMP AND CLAIMS HE WITHDREW AFTER THREATENING TO ATTACK WEST ASIA ENERGY FACILITIES."Adding to that, Iran is claiming now that "US president retreats after Iran's decisive threats" on television.So yeah, who's telling the truth here?Considering Trump's supposed 48-hour ultimatum before this, it really didn't sound like talks were on the cards at any point. And now supposedly, there were "very productive" conversations had over the weekend? Hmm.I'm not doubting the possibility that there was maybe some contact between the two sides. But the thing here is, everything needs to be put into better context. We all know that Trump loves a good spin to the story but there's always two sides to the coin.We've seen it all before when it comes to China and all the trade deals they've struck in the past. Trump will say one thing but Beijing will say another thing.This definitely looks to be another one of those times. So, be careful with how you're reading into the latest headlines here. At the end of the day, what really matters is the situation on the ground. Nothing changes until the Strait of Hormuz blockade is actually lifted. This article was written by Justin Low at investinglive.com.

Gold is down another 4% today as it closes in on $4,300 while silver is down 6% on the day as nears $64. It's starting to get rough out there as precious metals are hit by a trifecta of negative factors.The US-Iran conflict might have seemed like a good reason for precious metals to gain on geopolitical tensions. That was the case in January amid tensions between the US and Venezuela. But when higher oil prices start coming into the picture, this is a totally different ball game.The first negative factor is a major shift in big picture outlook for markets. For over two years now, precious metals could fall back on major central banks cutting interest rates as a key upside driver. However, the scrip has flipped on its head now. As inflation fears creep in, central banks are now having to quickly pivot to rate hikes instead. And that's a big change for trading sentiment in precious metals as well.The latest drag last week was a significant one. And that is where the second factor comes in, that being a technical one. The drop on Friday had a lot riding on it as we see both gold and silver drop below their respective 100-day moving averages (red line). That's the first meaningful break below that for gold since 2023 and for silver, it's the first since a brief dip in April 2025. That aside, it's also the first material technical break below the key level for silver since 2023 as well.And the charts are looking really, really rough at the moment.For gold, it is already running a break below the 2 February low with some minor support closer to $4,275. Otherwise, we look to be in for a deeper rout here with eyes on the 200-day moving average (blue line) at $4,091 next.For silver, it is now taking a run at the 6 February low near the $64 level. A firm break below that opens up the floodgates towards the 200-day moving average (blue line) closer to $57.45 at the moment.The technical signs are certainly compelling, in the sense that it would not be wise to try and pick at bottoms here. And in other words, it looks like there will be more pain to come before things get better.Adding to all this is the third factor and that is added selling in the likes of bonds and stocks. In the past year, precious metals have been a favoured position undertaking for leveraged trades. But when we see a broader market selloff such as this one and especially one that looks like it can turn really bad for stocks too, be very mindful of the impact of margin calls. From Friday:"Besides the point in equities, keep an eye out for the likes of precious metals too. If you think the heavy selling at one point yesterday was bad, wait until we see stocks trigger stops on any further break lower from this point. That can cascade further to margin calls and trigger more volatile selling in the likes of gold and silver as market players need to front up the cash." This article was written by Justin Low at investinglive.com.

There aren't any major expiries to take note of for the day, with the full list seen below.There is a large-ish one for EUR/USD at the 1.1600 mark but it likely won't factor much into play. That as the broader market sentiment right now is more focused on inflation fears as the Middle East conflict looks set to drag on further.US president Trump delivered a 48-hour ultimatum to Iran, calling for the reopening of the Strait of Hormuz. That deadline will end later today but so far, Iran has not shown any signs of relenting.As such, markets are growing even more anxious amid higher bond yields as major central banks shift to factoring in rate hikes this year. That's leading to broad-based selling in other markets too with stocks getting crushed and precious metals also losing out on a double whammy i.e. no more supportive rate cuts and potential margin calls being triggered.In essence, there's almost no shelter when we get into this phase of the crisis and markets are selling off everywhere. The dollar is one of the better bets as everyone is hunting for cash. So, that's the biggest driver impacting trading sentiment in the major currencies space today.The expiries above will have minimal impact, with traders staying focused on risk sentiment as well as headline risks. It's still all about the US-Iran conflict currently. There is just no other game in town.For more information on how to use this data, you may refer to this post here.Head on over to investingLive (formerly ForexLive) to get in on the know! This article was written by Justin Low at investinglive.com.

Iran's Islamic Revolutionary Guard Corps (IRGC) have come out to say that they will be "determined to respond to any threat at the same level as it creates in terms of deterrence". Adding that if the US decides to "hit electricity, then we will hit electricity". And if the US plans attacks on power plants, then Iran will respond by striking Israel's power plants and regional facilities that supply electricity to US bases.This of course is a response to US president Trump's warning over the weekend. Trump delivered a 48-hour ultimatum to Iran on Saturday, calling for the reopening of the Strait of Hormuz. And if not, he will order the US military to "hit and obliterate" Iran's power plants - starting with "the biggest one first".He didn't specifically name it but it likely points to the Bushehr nuclear power plant, which had already been partially damaged last week. That or the Damavand power station (natural gas plant) close to Tehran. Or perhaps he will call the order to strike both targets. So, we'll see.With Trump delivering that ultimatum on Saturday, the 48-hour clock will run out at the end of today. As such, we can only wait and see if he will walk the walk after talking the talk.Iran had also warned over the weekend that they could continue to target other key infrastructure across the Gulf region, such as water desalination facilities. That is something that they already began outlining last week already here. That was after the South Pars gas field was attacked of course. This article was written by Justin Low at investinglive.com.

It's a brand new week but the main focus in markets stay on the Middle East. The US-Iran conflict drags on further and the latest development is that US president Trump delivered a warning over the weekend for Iran to "reopen" the Strait of Hormuz. Trump gave a 48-hour ultimatum, which will run its course late in the day today.Iran has so far responded that they will not back down and are willing to escalate things further. So, that's leaving us to where we are now as the crisis in the region extends. As we go on longer, higher oil prices continue to become more entrenched for global economies and restarting the normalisation process in energy market itself will take a much longer time.In turn, inflation fears will just continue to boil and that's inflicting pain in the bond market. Yields are surging higher and not just in the US, we're seeing the same everywhere. 10-year Treasury yields are up to 4.41%, a marked climb from 3.95% at the end of February. That as the conversation shifts from Fed rate cuts to Fed rate hikes instead. The curve has essentially shifted and quite dramatically in just a span of a few weeks.It's the same in other places too. 10-year gilt yields have also surged up near 5% at the end of last week, its highest since 2008. That also comes as short-term yields in the UK i.e. 2-year yields have jumped over 100 bps alone in March.In Europe, 10-year bund yields have also moved up to 3.05% - its highest since 2011. The same for 10-year yields in France, with it rising to 3.76% - also the highest since 2011.I would argue that the main issue here is how quickly the bond market has had to reprice the central bank and inflation outlook. And that's bound to uncover a lot of exposed positions and pain points in broader markets as well. Equities already will not like the sight of war but now have to deal with one of its most hated pain points, that being higher yields.Selling upon selling can get painful very quickly and as warned last week, may even trigger margin calls and spread over to precious metals too. And today, gold is down near 3% to $4,365 while silver is down 3% to $65.70 currently. From Friday:"Besides the point in equities, keep an eye out for the likes of precious metals too. If you think the heavy selling at one point yesterday was bad, wait until we see stocks trigger stops on any further break lower from this point. That can cascade further to margin calls and trigger more volatile selling in the likes of gold and silver as market players need to front up the cash."If the Middle East conflict drags on further and oil gets comfortable way above the $100 mark, be sure to strap yourselves in for an extremely bumpy ride. There's not going to be any shelter for market players if this keeps up. This article was written by Justin Low at investinglive.com.

Warsh faces turbulent Fed transition as inflation, politics and oil shock collide.Japan weighs cutting inflation-linked bond buybacks as demand risesICYMI: Fitch sees Brent at $120 if Hormuz closure persists in 2026IEA warns Middle East crisis worse than 1970s oil shocks, eyes stock releasesSaudi Aramco cuts Asia oil supply as Hormuz disruption tightens marketPBOC sets USD/ CNY reference rate for today at 6.9041 (vs. estimate at 6.8928)Gold gets smashed as oil shock lifts yields, boosts dollar, and crushes rate-cut hopes.Japan flags FX intervention risk. Oil shock drives yen volatility and policy response.Saudi pipeline bypass eases oil shock, here's what’s next for global supply.UK calls emergency COBRA meeting as Iran war lifts inflation and gilt yieldsGoldman Sachs lifts 2026 oil forecasts: Brent $85, WTI $79 on Hormuz riskPrivate credit stress reemerges as Blackstone fund posts rare loss and withdrawals rise.Crude oil jumps higher after Trump's flaccid threats and Iran's revenge responseNew Zealand outlook cut to negative by Fitch as debt concerns mountGulf shipping risks rise after blast near vessel off UAE Sharjah coastOil rises as Trump ultimatum to Iran fuels Hormuz escalation risksMonday open indicative forex prices, 23 March 2026Trump: We are very close to meeting our objectives in IranTrump issues 48-hour ultimatum to Iran over Hormuz reopening Iran threatens retaliation targeting US and Gulf energy infrastructure IEA warns crisis worse than 1970s oil shocks, flags supply losses USD firms in thin trade; USD/JPY back above 159.50 Asian FX weak, KRW hits lowest since 2009 Gold sharply lower, falling below $4,340 Oil spikes at open, then trades choppy Risk sentiment weak; Asian equities sell off broadlyMarkets opened the week on edge, dominated by escalating geopolitical tensions following US President Donald Trump’s 48-hour ultimatum to Iran to reopen the Strait of Hormuz or face potential strikes on key infrastructure. The deadline, set to expire Monday evening in New York, has placed markets on high alert for further escalation.Iran responded forcefully, warning that any US action would trigger retaliatory strikes targeting American and Israeli-linked energy assets across the Gulf, along with desalination pand power plants in its neighboring GCC countries. Officials also reiterated the risk of a prolonged or indefinite closure of the Strait of Hormuz, raising the prospect of a sustained disruption to global oil flows.The energy shock narrative was reinforced by International Energy Agency chief Fatih Birol, who described the situation as “very severe” and potentially worse than the oil crises of the 1970s. Birol noted that current disruptions are estimated at around 11 million barrels per day, exceeding the combined losses of the two major oil shocks of that era, with some analysts suggesting the figure could be closer to 13 million barrels per day. The IEA is now consulting governments on the potential release of additional strategic oil reserves.In early trade, the US dollar firmed in thin liquidity conditions, before broader FX markets settled into relatively contained ranges. USD/JPY pushed back above 159.50, while commodity-linked currencies including the AUD and NZD remained under pressure. The Korean won was a notable mover, weakening to its lowest level since March 2009.Gold came under heavy selling pressure, falling sharply below $4,340 as rising yields and a stronger dollar offset safe-haven demand. Oil prices initially surged on the Globex open, reflecting heightened geopolitical risk, before trading in a more volatile and choppy pattern.Risk sentiment across Asia remained fragile. Equity markets extended declines, with Japan’s Nikkei 225 falling sharply back below 52,000, Hong Kong’s Hang Seng dropping more than 3%, and China’s Shanghai Composite down over 2%. This article was written by Eamonn Sheridan at investinglive.com.

Warsh’s potential Fed leadership comes at a uniquely difficult moment, with rising inflation, political pressure, and transition uncertainty complicating the policy outlook.Info comes via the Wall Street Journal, gated. Summary:Kevin Warsh faces unusually complex Fed leadership transition Confirmation stalled amid political dispute over Powell probe Oil shock and rising inflation complicate policy outlook Markets now pricing hikes over cuts despite prior dovish expectations Trump pressure for lower rates adds political tension Warsh previously signalled sharp break from Powell-era policy Risk of perceived political influence on Fed decisions rising Transition uncertainty grows as Powell may remain in roleKevin Warsh’s potential transition to Federal Reserve chair is shaping up to be one of the most complex and politically charged handovers in decades, as rising inflation, an energy shock, and a stalled confirmation process collide.Warsh, who had previously signalled support for lower interest rates, now faces a dramatically altered economic backdrop. Inflation pressures were already building before the escalation in the Middle East drove oil prices higher, and markets have since shifted expectations toward the possibility of further rate increases rather than cuts in the near term.At the same time, his confirmation remains uncertain. A political standoff linked to a Justice Department investigation involving current Fed Chair Jerome Powell has delayed proceedings, leaving open the possibility that Powell could remain in the role even after his term expires. This raises the prospect of an overlapping or delayed leadership transition, adding to institutional uncertainty.The situation is further complicated by political pressure from President Donald Trump, who has made clear that he expects lower interest rates. Analysts say this creates a difficult balancing act for Warsh, who must navigate between presidential expectations, a Federal Open Market Committee that has grown more cautious on rate cuts, and a macro environment increasingly shaped by inflation risks.Unlike previous Fed transitions, Warsh has publicly criticised the policy direction under Powell, calling for a more fundamental shift in approach. Historically, incoming Fed chairs have emphasised continuity to reassure markets, even when planning longer-term changes. Warsh’s more confrontational stance has raised questions about how smoothly the transition can be managed.The current macro backdrop adds to the challenge. Central banks typically look through oil shocks, assuming that higher inflation is offset by weaker growth. However, after several years of above-target inflation, policymakers may be less confident that price pressures will quickly fade, increasing the risk that inflation expectations become entrenched.This leaves the Fed facing a familiar dilemma: whether to prioritise inflation control or support growth. For Warsh, the challenge is heightened by the political context, with any policy easing likely to be scrutinised for signs of political influence.While some economists argue that the broader economic environment remains stable, others note that the combination of geopolitical risk, inflation uncertainty, and leadership ambiguity creates a uniquely difficult starting point for any incoming Fed chair.What happens next? The immediate focus is on the timing and outcome of Warsh’s confirmation.If the process remains stalled, Powell could continue to lead the Fed beyond his term expiry, prolonging uncertainty around policy direction. This would likely reinforce a “wait-and-see” stance in markets, with traders focusing more on incoming data than leadership expectations.If Warsh is confirmed, attention will shift quickly to whether his policy stance aligns with current market conditions. While he had previously leaned toward rate cuts, the evolving inflation outlook, particularly if energy prices remain elevated, may force a more cautious or even hawkish approach.Markets will also be watching for signs of institutional cohesion. Any perception of division within the Federal Open Market Committee, or between the Fed and the White House, could increase volatility across rates, FX, and risk assets.The biggest macro variable remains inflation. If oil-driven price pressures prove temporary, the Fed may still be able to pivot toward easing later. However, if inflation proves persistent, policymakers could be forced to prioritise price stability, even at the cost of weaker growth.In that scenario, Warsh could find himself taking a very different policy path than the one he initially signalled, highlighting how rapidly the economic landscape has shifted. This article was written by Eamonn Sheridan at investinglive.com.

Japan’s potential reduction in inflation-linked bond buybacks reflects rising inflation expectations and stronger demand, signalling a tentative shift away from its deflationary past.Summary:Japan considering reducing buybacks of inflation-linked bonds Move driven by rising investor demand amid higher inflation expectations Break-even inflation rate rises above 1.9% Planned buybacks for April–June cut to ¥15bn per operation Down from ¥20bn monthly purchases in Q1 Issuance volume likely unchanged at ¥250bn Reflects improving demand and less need for market support Signals shifting inflation dynamics in Japan Japan is weighing a reduction in its buybacks of inflation-linked government bonds, reflecting growing investor demand as inflation expectations continue to rise.According to sources familiar with the matter cited by Reuters, the Ministry of Finance is considering scaling back its regular repurchase operations for inflation-linked bonds, with planned buybacks of around ¥15 billion each for April and June. This would mark a notable reduction from the ¥20 billion monthly buybacks conducted in the first quarter of the year.The potential adjustment comes as market conditions for inflation-linked securities improve. Japan’s break-even inflation rate, a key market-based gauge of expected inflation, has recently climbed above 1.9% for the first time, signalling a shift in investor sentiment and making inflation-protected assets increasingly attractive.Inflation-linked bonds are designed to shield investors from rising prices, with both principal and coupon payments adjusted in line with consumer price inflation. As expectations for inflation strengthen, demand for such securities tends to increase, reducing the need for government intervention to support market liquidity.The move also reflects a broader evolution in Japan’s inflation dynamics. For much of the past two decades, the country struggled with deflation, which limited the appeal of inflation-linked instruments and at times forced authorities to halt issuance altogether. Since their reintroduction in 2013 as part of efforts to reflate the economy, the government has actively supported the market through buybacks and principal guarantees.However, the recent rise in inflation expectations, which predated but has been reinforced by the global energy shock linked to the Middle East conflict, suggests a more durable shift may be underway. Analysts say the increased demand for inflation-linked bonds indicates that investors are beginning to price in a more sustained period of price pressures.Despite this improvement, officials are proceeding cautiously. The Ministry of Finance is expected to consult market participants before finalising any changes, while issuance volumes are likely to remain unchanged for now, ensuring continued supply to meet demand.The adjustment in buyback operations can be seen as a gradual step toward normalising market conditions, as policymakers respond to evolving inflation expectations while maintaining flexibility in an uncertain macro environment.What happens next? The key question is whether this marks the beginning of a more structural shift in Japan’s inflation regime.If inflation expectations continue to rise, particularly as higher energy prices feed through the economy, demand for inflation-linked bonds is likely to remain strong, potentially allowing the government to further reduce its market support over time.This would reinforce the narrative that Japan is moving away from its long-standing deflationary environment, with implications for broader policy settings. In such a scenario, the Bank of Japan may face increasing pressure to continue normalising policy, particularly if inflation proves more persistent.However, the transition remains fragile. Economists note that while inflation expectations have improved, underlying domestic demand is still recovering, and the risk of a reversal cannot be ruled out. If inflation momentum fades or economic growth weakens, authorities may need to step back in to support the market.From a market perspective, reduced buybacks could also affect pricing dynamics, potentially leading to higher real yields if demand does not fully absorb the reduced official support. At the same time, stronger demand for inflation protection could continue to compress break-even rates, depending on investor positioning.In short, the move signals progress, but not yet a definitive break from Japan’s past. The trajectory of inflation, energy prices, and global conditions will determine whether this shift becomes entrenched or proves temporary. This article was written by Eamonn Sheridan at investinglive.com.

Fitch’s note from Friday. Scenarios highlight the scale of upside risk to oil prices, with prolonged Hormuz disruption potentially driving Brent toward $120 and keeping markets volatile.Summary:Fitch outlines oil price scenarios tied to duration of Hormuz closure Brent seen averaging $120/bbl in 2026 under six-month disruption Three-month closure scenario points to ~$100/bbl average Base case remains $70/bbl, assuming only temporary disruption Prices could spike to $130–$170/bbl during extended closure Estimated loss of ~15mb/d in transit volumes through Hormuz Demand destruction expected in prolonged disruption scenarios IEA reserve releases seen cushioning near-term supply shockFitch Ratings has outlined a range of oil price scenarios for 2026, highlighting how the duration of disruption in the Strait of Hormuz could significantly reshape the global energy outlook.In its latest analysis, the agency estimates that Brent crude could average as high as $120 per barrel next year if the Strait remains effectively closed for six months. A shorter, three-month disruption would still push prices materially higher, with Brent seen averaging around $100 per barrel for 2026.Both scenarios mark a sharp departure from Fitch’s base case, which assumes a more temporary disruption and forecasts an average price of $70 per barrel. That baseline incorporates a near-term spike driven by the current crisis, followed by a gradual easing as supply conditions normalise and prices fall back toward $60 per barrel by year-end.Under the more severe disruption scenarios, however, price dynamics become significantly more volatile. Fitch expects oil to spike sharply during the period of closure, with prices potentially averaging between $130 and $170 per barrel in a prolonged six-month disruption. Even in a shorter disruption scenario, prices are seen holding near $130 during the peak before easing back toward $90 per barrel later in the year.The core driver behind these projections is the scale of supply disruption. Fitch estimates that a closure of the Strait would remove around 15 million barrels per day of transit volumes from the market, even assuming some limited flows continue.To balance the market under these conditions, the agency expects a combination of demand destruction and supply-side responses. In the three-month scenario, demand is projected to fall by around 2.5%, while a six-month disruption could trigger a deeper contraction of roughly 5.5%. Additional releases from strategic reserves — including those coordinated by the International Energy Agency — are also assumed to help offset the shock.Despite these mitigating factors, Fitch emphasises that oil markets are likely to remain highly volatile. The geopolitical risk premium remains elevated, and uncertainty around the duration of the conflict and the extent of supply disruption continues to dominate the outlook.What happens next? The key variable for markets now is duration.If the Strait of Hormuz is reopened relatively quickly, the oil market may follow something close to Fitch’s base case, a sharp but temporary spike followed by a retracement as supply chains normalise and strategic reserves are deployed.However, if disruption persists beyond a few months, the dynamics shift meaningfully. A prolonged closure would force a deeper rebalancing of the market through demand destruction, higher prices, and more aggressive policy responses. In this scenario, oil would likely trade with a sustained geopolitical premium, with spikes above $130 becoming more frequent.Markets will also closely monitor the effectiveness of mitigation measures. Strategic reserve releases, alternative export routes such as Saudi Arabia’s East-West pipeline, and supply responses from non-Gulf producers could help stabilise prices at the margin — but are unlikely to fully offset the loss of Hormuz flows.Another key risk is escalation. If infrastructure outside Hormuz, such as Red Sea routes or key export terminals, comes under sustained pressure, the supply shock could deepen further, pushing prices toward the upper end of Fitch’s projections.Ultimately, the path of oil prices will hinge on whether the current الأزمة remains a contained disruption or evolves into a more prolonged structural shift in global energy flows. For now, markets are likely to remain highly sensitive to both geopolitical developments and signs of supply adjustment. This article was written by Eamonn Sheridan at investinglive.com.

IEA warns crisis worse than 1970s shocks as Hormuz disruption drives global energy strain.Summary:IEA warns Middle East crisis is “severe” and escalating Birol says situation worse than both 1970s oil crises combined Reopening Strait of Hormuz seen as the single biggest solution IEA consulting governments on potential further strategic oil releases No fixed oil price trigger for additional stock releases Fuel shortages emerging as a growing issue across Asia Australia flagged as actively boosting fuel stockpiles Signals risk of prolonged global energy disruptionThe International Energy Agency (IEA) has issued a stark warning on the global energy outlook, describing the current Middle East crisis as more severe than the oil shocks of the 1970s and signalling that further coordinated intervention may be required.IEA Executive Director Fatih Birol said the situation has reached a critical point, with disruptions to supply chains and shipping routes creating mounting pressure across global energy markets. He emphasised that the most effective solution would be the reopening of the Strait of Hormuz, a vital chokepoint through which a significant portion of the world’s oil supply normally flows.The warning comes as markets continue to grapple with the fallout from escalating conflict in the region, which has effectively constrained flows through Hormuz and triggered sharp increases in oil prices. Analysts say the scale of disruption is already comparable to major historical energy shocks, with knock-on effects being felt across fuel supply chains, particularly in Asia.Birol noted that the IEA is actively consulting with governments around the world to assess whether additional releases from strategic petroleum reserves may be necessary. While the agency has previously coordinated stock releases to stabilise markets, he stressed that there is no predefined oil price level that would automatically trigger further action, underscoring the complexity of the current الأزمة.The impact is becoming increasingly visible at the consumer level, with fuel shortages emerging in parts of Asia as supply constraints intensify. Countries heavily reliant on imported energy are facing rising costs and logistical challenges, prompting governments to consider emergency measures to secure supply.Australia was highlighted as one country actively working to increase fuel stock levels, reflecting broader efforts among energy-importing nations to build buffers against further disruptions. Birol did add that he isn't worried about Oz fuel stocks yet. The developments point to a deepening global energy crisis, with policymakers facing difficult choices between managing inflationary pressures, ensuring energy security, and stabilising financial markets. Analysts say the combination of supply constraints, geopolitical risk, and policy uncertainty is likely to keep energy markets volatile in the near term, with potential spillovers across inflation, growth, and central bank policy expectations.Quick explainer: What is the IEA?The International Energy Agency (IEA) is a Paris-based intergovernmental organisation that coordinates energy policy among major economies, particularly in response to supply disruptions. Originally established after the 1970s oil shocks, the IEA plays a key role in monitoring global energy markets and organising coordinated releases of strategic oil reserves among member countries to stabilise supply and prices during crises. This article was written by Eamonn Sheridan at investinglive.com.

Summary:Saudi Aramco cuts April crude supply to Asian buyers Supplies constrained due to Hormuz disruption from Iran conflict Buyers told to lift only Arab Light crude from Yanbu terminal Shift reflects reliance on Red Sea export route via East-West pipeline Limited pipeline and terminal capacity forcing supply rationing Heavier crude grades likely harder to supply amid disruption Asian refiners face feedstock mismatch and potential output cuts Move underscores tightening physical oil market conditions Saudi Aramco has reduced crude oil allocations to Asian buyers for April, highlighting the growing strain on global energy supply chains as disruptions in the Strait of Hormuz continue to ripple through markets.According to sources familiar with the matter, the world’s largest oil exporter has notified at least some term customers in Asia that they will receive lower volumes than requested for April loadings. In a further sign of tightening logistics, buyers have also been told that cargoes will be limited to Arab Light crude shipped from the Red Sea port of Yanbu, rather than the broader slate of grades typically available from Gulf export terminals. The changes reflect the ongoing impact of the Iran conflict, which has severely disrupted shipping through the Strait of Hormuz, a critical artery that normally handles a significant share of global oil flows. In response, Saudi Arabia has increasingly relied on its East-West pipeline to reroute crude to Yanbu, bypassing the Gulf altogether.However, this workaround comes with clear constraints. While the pipeline provides a vital alternative route, its effective capacity is well below the volumes typically shipped through Hormuz, forcing Aramco to ration supply among customers. Analysts note that the shift toward Arab Light crude also suggests limitations in the ability to move heavier grades, which are often preferred by Asian refiners.The supply adjustments are already feeding into broader market tightness. Regional refiners, particularly in Asia, are facing a mismatch between available crude grades and their processing configurations, raising the risk of reduced refinery runs or increased reliance on alternative suppliers.The development underscores how logistical bottlenecks, rather than outright production shortages, are becoming a key driver of market dynamics. Even where oil remains available in the ground, the ability to transport it efficiently to end-users has become increasingly constrained.With Saudi Arabia long seen as a stabilising force in global oil markets, the decision to cut allocations highlights the severity of the current disruption and reinforces expectations of continued volatility in physical crude markets.What happens next?The immediate focus will be on whether supply constraints deepen or stabilise.If disruptions in the Strait of Hormuz persist, further allocation cuts from Saudi Arabia, and potentially other Gulf producers, are likely. The key bottleneck remains export infrastructure rather than production capacity, meaning even modest improvements in security or shipping access could quickly ease pressure.However, risks remain skewed to the upside for oil prices. The reliance on Yanbu and the East-West pipeline creates a concentration risk, particularly as these routes have already come under threat. Any sustained disruption to Red Sea infrastructure would represent a significant escalation, potentially removing one of the last functioning outlets for Gulf crude.For Asian buyers, the situation could lead to a scramble for alternative supply, including West African, US, or Latin American barrels, likely at higher cost. Refiners may also be forced to adjust operations to process lighter crude grades, impacting margins and product output.Over the medium term, the current crisis is likely to accelerate structural changes in global oil logistics, with greater emphasis on diversified export routes, storage capacity, and supply chain resilience. However, these adjustments take time, meaning near-term markets are likely to remain tight and highly sensitive to geopolitical developments.In short, unless Hormuz flows are restored quickly, the current situation points to continued supply rationing, elevated price volatility, and a sustained geopolitical risk premium in oil markets. This article was written by Eamonn Sheridan at investinglive.com.