[MARKET ANALYSIS] DXY is essentially flat, G10s incrementally lower vs USD, Kiwi underperforms

DXY is essentially flat and trades within a narrow 99.56-99.75 range, with price action taking a breather after a string of ceasefire related volatility. Recent reports surrounding the Middle East situation suggests that US President Trump told aides he wants a speedy end to the Iran war and wants to wrap up the conflict in the coming weeks, via WSJ. Elsewhere, Israeli Media reported that US President Trump may announce a ceasefire with Iran by next Saturday.
On the data front, weekly initial jobless claims data for the 21st March week are expected to print 210k (from 205k), while continuing claims for the 14th March week (which coincides with the BLS survey window for the March jobs data) is seen at 1.86mln (from 1.857mln). On the speakers’ docket, Fed’s Miran (voter, dovish dissenter) to speak on the Fed’s Balance Sheet; Fed’s Vice Chair Jefferson (voter, dovish) will speak on the outlook; Fed’s Barr (voter, neutral) will speak on the economy; Fed’s Cook (voter, neutral) to give a speech on ‘Reflections on Financial Stability’.
G10s are incrementally lower against the USD (ex-Antipodeans). Ultimately, subdued price action as markets await updates related to concrete progress on the ceasefire plan, or the risk of another bout of escalation measures. Most recently, Axios reported that Trump is preparing for a massive “final blow” against Iran. Antipodeans are at the bottom of the G10 pile this morning, with the Kiwi underperforming – pressure which follows the broader downbeat risk-tone. EUR/USD trades within a very thin 1.1547-1.1572 range, and ultimately little moved to ECB’s Nagel and de Guindos. Elsewhere, Cable is incrementally lower, as traders await commentary from BoE’s Breeden, Taylor and Greene. Focus will be on the former, given Taylor spoke last week (remained dovish), whilst Greene spoke on Wednesday.
NOK is net-unchanged in the aftermath of the Norges Bank policy announcement, where the Bank kept rates steady at 4% (as expected). There was some volatility at the time, with EUR/NOK moving higher as traders unwound outside bets of a hike. That move since entirely pared. Decision aside, focus was on the MPR and accompanying commentary was hawkish, with the Bank noting that "it will likely be appropriate to raise the policy rate at one of the forthcoming monetary policy meetings". This was also reflected by the updated MPR, whereby the end-2026 rate is now seen at 4.35% (prev. 3.71%); 2027 was revised higher to 3.98% (prev. 3.31%), and the "terminal rate" was raised to 3.54% (prev. 3.20%) - SEB expected the terminal rate to be raised to this figure. Speaking on future policy, the Bank provided two-way scenarios, highlighting the risks to both the inflation/labour environment, which could impact the speed of hikes/cuts.