EUR/USD
The EUR/USD pair opens with a bullish gap at the start of a new week as renewed optimism over a potential US-Iran peace deal weighs heavily on the safe-haven US Dollar (USD). Spot prices climb back closer to mid-1.1600s during the Asian session, though the broader setup warrants some caution before positioning for an extension of a modest recovery from the lowest level since April 7, around the 1.1575 region, touched last Thursday.
GBP/USD
The GBP/USD pair is seen building on its modest bullish opening gap on Monday and recovering further from its lowest level since April 8, around the 1.3300 round figure touched last week. The intraday move up is sponsored by a broadly weaker US Dollar (USD) and lifts spot prices back closer to the 1.3500 psychological mark, or a one-and-a-half-week high during the Asian session.
USD/JPY
The USD/JPY pair edges lower to around 158.85, snapping the two-day winning streak during the Asian trading hours on Monday. The US Dollar (USD) weakens against the Japanese Yen (JPY) amid signs of a US-Iran deal to reopen the Strait of Hormuz.
AUD/USD
The AUD/USD pair gains momentum to near 0.7160 during the early Asian session on Monday. The reports that the United States (US) and Iran are closing in on a deal that would reopen the Strait of Hormuz provide some support to the riskier asset such as the Australian Dollar (AUD) against the Greenback.
NZD/USD
NZD/USD depreciates after opening at a higher level from the previous close, still remaining in the positive territory and trading around 0.5870 during the Asian hours on Monday. The New Zealand Dollar struggles against the US Dollar (USD) after a majority of the NZIER shadow board members backed holding New Zealand’s Official Cash Rate at 2.25% on the May 27 policy decision.
USD/CAD
The USD/CAD pair edges lower to around 1.3805 during the early European session on Monday. The US Dollar (USD) softens against the Canadian Dollar (CAD) after US officials signal progress on a peace deal with Iran. Trading volumes are expected to be light due to a market closure for Memorial Day in the US.
USD/CHF
USD/CHF extends its losing streak for the fourth consecutive day, trading around 0.7820 during the Asian hours on Monday. The pair depreciates as the US Dollar (USD) declines on fading safe-haven demand amid increasing optimism over a potential US-Iran agreement, which has eased broader market concerns about inflation and impending Federal Reserve (Fed) interest rate hikes.
CRUDE OIL
Oil prices fell 6% to two-week lows on Monday, as optimism grew that the United States and Iran were moving closer to a peace deal, even though they remain at odds over key issues, such as blockades on the Strait of Hormuz.
Gold (XAU/USD) struggles to build on its modest Asian session gains to the $4,580 region on Monday and remains below the top boundary of a range held over the past week or so amid mixed fundamental cues. Developments over the weekend spurred hopes for a potential US-Iran peace deal, undermining the US Dollar’s (USD) reserve currency status and lending support to the commodity. The US and Iran, however, remain at odds over key issues. This, along with hawkish US Federal Reserve (Fed) expectations, helps limit the USD losses and keeps a lid on any further gains for the non-yielding yellow metal.
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