[MARKET ANALYSIS] DXY remains lacklustre after retreating yesterday amid hopes for an end to the Iran conflict

DXY: -0.1%

• Remains lacklustre after weakening yesteday as risk appetite was underpinned by optimism of a sooner end to the Iran conflict after recent comments from both Iran and the US as Iranian President Pezeshkian said the solution is an end to aggression and that Iran seeks no war but is prepared to end it with guarantees against further attacks, which marked a notably positive shift in Iranian rhetoric, while US President Trump said he believes the Iran war is likely to end soon and other nations can reopen the Strait of Hormuz themselves. Furthermore, Trump suggested the US will be leaving Iran in two or maybe three weeks, and he is scheduled to deliver a nationwide address on Wednesday to give an important update on Iran at 21:00EDT/02:00BST. Outside of geopolitics, recent data had little impact on FX, while participants look ahead to more data releases stateside, including ADP Employment Change, Retail Sales, and ISM Manufacturing PMI.

EUR/USD: +0.1%

• Holds on to the prior day's spoils with a firm footing at the 1.1500 handle after benefitting from a softer dollar and with rhetoric from ECB officials brushing on the prospects of a rate hike.

GBP/USD: +0.1%

• Lacks firm direction after the recent choppy performance and rebound from a brief dip benath the 1.3200 level, while the UK government confirmed new measures to ease the cost of living pressure are to come into force today including an increase in the national living wage to GBP 12.71 and with energy bills to be cut by average GBP 117 a year for millions across the UK which will be locked in until end of June.

USD/JPY: Flakes

• Pauses overnight after sliding beneath the 159.00 level as the dollar was pressured on optimism regarding an end to the Iran conflict, while data releases showed a mostly stronger-than-expected Tankan survey, which supports the case for an April BoJ rate hike.

Antipodeans: AUD/USD +0.2% / NZD/USD -0.1%

• Price action is mixed amid the mostly positive risk appetite and disappointing Chinese RatingDog Manufacturing PMI data.