InvestMacro

On Friday, US stock indices closed. By the end of the week, the Dow Jones (US30) rose by 1.31%. The S&P 500 (US500) gained 2.00%. The tech‑heavy NASDAQ (US100) finished the five‑day period up 2.48%. The upcoming week will be packed with critical data to help assess the true scale of the economic damage caused by the conflict. The ISM Services PMI is expected to be the first indicator to capture supply‑chain disruptions and rising costs. Particular attention will be paid to the March Consumer Price Index, where last year’s low base effect may trigger a sharp jump in the annual reading. Investors will also closely examine the FOMC meeting minutes to understand how the Fed leadership assessed the risks of an inflationary spiral two weeks after the blockade of the Strait of Hormuz began.

The dynamics of the Mexican peso in early April 2026 are shaped by a tight link to global capital markets and domestic growth challenges. The currency shows extreme sensitivity to risk appetite: the inverse correlation between USD/MXN and the S&P 500 has reached a low level of 0.80, the strongest since 2020. This makes the peso highly vulnerable to any negative news from the Middle East. Mexico’s domestic agenda is shifting from fighting inflation to supporting a stagnating economy. Although consumer prices (CPI) remain above the 2-4% target range, the central bank cut rates at the end of March, signaling a priority on economic growth. February industrial production data, expected later this week, may confirm the negative trend following January’s 1.1% slump. Weakness in the manufacturing sector deprives the peso of fundamental support.

Analysis of the USD/CAD pair in early April 2026 reveals an anomaly: the traditional link between the Canadian dollar and energy markets has nearly disappeared. The correlation between the loonie and oil has turned slightly positive (+0.15), paradoxically indicating CAD weakness even as oil prices rise. The main driver is the overall strength of the US dollar, with a still‑high correlation of 0.60, confirming that global flight to safety outweighs Canada’s status as a resource exporter. Fundamental pressure on the Canadian dollar is intensifying due to troubling labor‑market data. After February’s loss of 108.4 thousand full‑time jobs and a rise in unemployment to 6.7%, investors are anxiously awaiting this week’s employment report. Weak numbers could cement expectations of a dovish Bank of Canada. The probability of a rate hike on April 29 is now below 10%, and expectations for policy tightening in 2026 have shifted to the fourth quarter, leaving the currency without rate‑differential support.

European stock markets were also closed on Friday due to Easter holidays. By the end of the week, Germany’s DAX (DE40) rose by 2.46%, France’s CAC 40 (FR40) gained 2.42%, Spain’s IBEX 35 (ES35) climbed to 3.50%, and the UK’s FTSE 100 (UK100) finished the five‑day period up with 4.65%.
WTI crude prices corrected to 111 dollars per barrel after an early‑morning spike to 115.5 dollars. The reversal was triggered by reports of a proposed 45‑day ceasefire between the US, Iran, and regional mediators, which could form the basis for a long‑term settlement. This diplomatic opening emerged against the backdrop of an extremely harsh ultimatum from Donald Trump, who threatened to destroy Iran’s civilian infrastructure if the Strait of Hormuz was not unblocked immediately. Tehran officially rejected Washington’s latest demands, maintaining the effective blockade. Adding fuel to the fire, OPEC+ announced over the weekend that it had approved an increase in production quotas to combat the global shortage, but warned that physical damage to regional energy infrastructure would limit supply long after a formal ceasefire.

Asian markets also mostly rose last week. Japan’s Nikkei 225 (JP225) gained 2.05%, China’s FTSE China A50 (CHA50) fell by 0.65%, Hong Kong’s Hang Seng (HK50) rose by 1.40%, and Australia’s ASX 200 (AU200) posted a 1.27% weekly gain.

The dynamics of the Australian dollar in early April 2026 are shaped by a complex interplay of global risk aversion and domestic inflationary pressures. The currency remains highly sensitive to the trajectory of the US dollar (correlation -0.75) and the stock market (correlation with the S&P 500 at 0.62), making it extremely vulnerable during periods of escalation in the Persian Gulf. Notably, the traditional link between the “aussie” and gold has weakened significantly: after peaking at 0.80 last month, the correlation has fallen to 0.45, reflecting the unusual behavior of the precious metal amid the current military crisis.

Domestically, attention is focused on February household‑spending data. The Reserve Bank of Australia responded to strong consumer demand at the end of 2025 with two rate hikes even before hostilities began on February 28. Now, despite geopolitical instability, futures markets are pricing an 80% probability of a third consecutive rate hike, viewing inflation control as the regulator’s top priority even as global growth slows. From a technical standpoint, the Australian dollar appears oversold after falling to a two‑month low near 0.6835.

In early April 2026, China is pursuing a strategy of currency stability, deliberately avoiding yuan devaluation despite the global strengthening of the US dollar. Setting the fixing at 6.8880 – the highest in recent years – indicates Beijing’s desire to minimize the cost of energy imports amid the Hormuz blockade. As the world’s largest oil importer, China faces serious challenges for its industrial sector, yet high fuel prices are paradoxically boosting domestic demand for electric vehicles and solar panels, strengthening the country’s position in the “green” sector. The macroeconomic picture remains uneven: before the start of “Operation Epic Fury,” China was battling consumer deflation, but in February the CPI jumped to a three‑year high of 1.3%. Inflation data for March, expected this week, is outlook by Bloomberg to show producer prices (PPI) returning to positive territory at 0.5%, while consumer inflation stabilizes around 1.2%. These figures will be critical for understanding how deeply disruptions in Iranian oil supplies and US-Israeli military actions have undermined price stability within China.

On Thursday, the US stock markets showed mixed dynamics. By the end of the day, the Dow Jones Index (US30) fell by 0.13%. The S&P 500 Index (US500) rose by 0.11%. The technology Index Nasdaq (US100) closed higher by 0.11%. Despite the negative finish, the market managed to significantly trim the losses recorded in the first half of the session. A reason for local optimism was the report that Iran, together with Oman, is developing a technical protocol for monitoring shipping through the Strait of Hormuz. This news gave investors hope for a partial restoration of trade routes, which somewhat cooled panic sentiment. In the corporate sector, the main focus was on Tesla, whose shares plunged 5% after the release of disappointing electric vehicle delivery data for the first quarter of 2026.

On Thursday, the Mexican peso (MXN) lost the progress achieved the day before, weakening to 17.88 per dollar. Fundamental pressure on the peso intensified due to the actions of the Bank of Mexico (Banxico). At its latest meeting, the regulator resumed its easing cycle, cutting the key rate by 25 basis points to 6.75%. The decision was made by majority vote (3 to 2) amid clear signs of a slowdown in the Mexican economy at the start of 2026. The fact that the central bank cut rates despite accelerating inflation signals a prioritization of economic growth over price stability, reducing the peso’s attractiveness for carry‑trade strategies.

European stock markets mostly dropped yesterday. Germany’s DAX (DE40) fell by 0.56%, France’s CAC 40 (FR40) closed down 0.24%, Spain’s IBEX 35 (ES35) declined by 0.14%, and the UK’s FTSE 100 (UK100) closed positive 0.69%. The shift in sentiment occurred after Donald Trump’s address, which did not provide the expected specifics on de‑escalation in the Persian Gulf. Traders also took into account the factor of the long weekend, as European exchanges will be closed on Friday due to Easter celebrations, prompting many market participants to close positions in advance.

On Thursday, the Swiss franc (CHF) traded at 0.80 per US dollar, holding near its lowest levels since mid‑January amid the dominance of the US currency as the world’s primary safe haven. Despite the franc’s traditional status as a defensive asset, investors are favoring the dollar. Core inflation in Switzerland accelerated in March to an annual high of 0.3%, which slightly eased pressure on the SNB regarding policy easing, as rising energy prices due to the conflict in the Persian Gulf have begun to offset the restraining effect of the strong national currency on import costs.

On Thursday, silver prices (XNG) collapsed by nearly 5% to 71 dollars per ounce, marking a total decline of more than 20% since the start of the conflict on February 28. The sharp plunge in the precious metal was triggered by the strengthening of the US dollar after Donald Trump’s address, in which he promised to deliver an “extremely strong strike” on Iran in the coming weeks instead of the de‑escalation plan expected by the markets. The absence of a clear exit strategy from the war and Tehran’s denial of rumors about requesting a ceasefire forced investors to seek refuge in the US currency, which traditionally puts downward pressure on dollar‑denominated assets.

WTI crude prices surged by 11%, breaking above 111 dollars per barrel. This is the highest level in almost four years. An even more dramatic situation unfolded with the North Sea Brent blend, whose price broke above 140 dollars per barrel, approaching the historical record of 2008. Such a sharp spike occurred as markets reassessed the scale of threats to global supply due to the escalation of the military conflict in the Persian Gulf. The main catalyst for the rally was Donald Trump’s tough statements, in which he promised to intensify strikes on Iran’s military and energy infrastructure in the coming weeks if Washington’s conditions are not met. Tehran responded with counter‑threats, instantly erasing yesterday’s optimism. Against this backdrop, the United Kingdom initiated large‑scale negotiations with dozens of countries to form an international coalition to ensure the security of trade routes. Meanwhile, the OPEC+ alliance is urgently considering the possibility of increasing production quotas to calm market panic. However, experts warn that in the short term, even additional oil volumes will not reach consumers as long as physical access to key regional terminals remains blocked or under threat of attack.

The US natural gas prices (XNG) showed negative dynamics on Thursday, falling below 2.81 dollars per MMBtu. Quotes approached the lows of August 2025, sharply contrasting with the rally in the oil market. The main driver of the decline was the weekly report from the Energy Information Administration (EIA), which recorded a larger‑than‑expected increase in storage inventories. During the reporting week, energy companies injected 36 billion cubic feet of gas, significantly exceeding both the figure for the same period last year (30 billion) and the five‑year average (only 4 billion). At the moment, total US gas inventories have reached 1.865 trillion cubic feet. This is 5.4% above last year’s level and 3% above the five‑year average. Such a surplus creates a reliable “safety cushion” for the US domestic market, offsetting the impact of global geopolitical instability.

Asian markets rose yesterday. Japan’s Nikkei 225 (JP225) fell by 2.38%, China’s FTSE China A50 (CHA50) declined by 0.73%, Hong Kong’s Hang Seng (HK50) fell by 0.70%, and Australia’s ASX 200 (AU200) showed a negative result of 1.06%.

On Friday, the offshore yuan (CNY) slightly strengthened to 6.88 per dollar, although the pace of growth slowed compared to the previous session. Investors cautiously welcomed the news that Iran and Oman are developing a protocol for “transit monitoring” through the Strait of Hormuz, giving hope for partial resumption of shipping. Despite diplomatic efforts, China’s domestic economic data for March reflected a noticeable cooling of activity. According to a RatingDog report, the composite PMI fell to 51.5 from February’s 55.4, with a slowdown recorded in both the manufacturing sector (50.8) and services (52.1).

On Tuesday, the US stock markets ended with a powerful rally. By the end of the day, the Dow Jones Index (US30) rose by 0.48%. The S&P 500 Index (US500) gained 0.72%. The Technology Index NASDAQ (US100) closed higher by 1.16%. Investor optimism at the beginning of April was fueled by signals of a possible de-escalation in the Middle East. Statements by Donald Trump that Iran had officially requested a ceasefire, and his readiness to withdraw troops within several weeks, provided the security of the Strait of Hormuz is ensured, became the key catalyst for the rally. This led to a sharp reduction of the geopolitical premium in oil prices, easing pressure on capital markets. However, the overall positive picture was overshadowed by a 15.6% drop in Nike shares – investors reacted extremely negatively to the company’s weak revenue guidance, which raised concerns about the sustainability of consumer demand in the retail sector.

The CAD strengthened to 1.39 per US dollar. The country’s manufacturing sector showed stagnation in March: the PMI fell to the critical level of 50.0. Zero growth is accompanied by a sharp increase in production costs and growing anxiety among Canadian manufacturers regarding possible trade tariffs from the United States. Such uncertainty in trade policy limits the recovery potential of the Canadian currency, despite the temporary calm in the Persian Gulf.

The Mexican peso showed a confident recovery, reaching 17.8 per US dollar. The main driver of growth was the return of global risk appetite amid signals of a possible de-escalation in the Middle East. After an extremely volatile March, when the currency suffered from massive unwinding of carry-trade positions and investor flight into safe-haven assets, the weakening of the US dollar allowed the peso to recoup a significant portion of its losses.

On Thursday, Bitcoin fell by about 2.0%, settling at 66,512 dollars. The digital assets market reacted to the emergency address of US President Donald Trump to the nation, in which he summarized the interim results of “Operation Epic Fury.” Despite the overall rhetoric about the mission nearing completion, Trump threatened Iran with an “extremely strong strike” in the next two to three weeks if Tehran does not comply with Washington’s conditions.
European stock markets showed a sharp rise yesterday. Germany’s DAX (DE40) rose by 2.73%, France’s CAC 40 (FR40) closed up 2.10%, Spain’s IBEX 35 (ES35) gained 3.11%, and the UK’s FTSE 100 (UK100) closed 1.85% higher.

On Wednesday, the US WTI crude oil futures ended trading at 99.60 dollars per barrel, recording a long-awaited drop below the psychological threshold of 100 dollars. Early April was marked by a wave of cautious optimism following Donald Trump’s statements about a possible end to the military operation in Iran within two to three weeks. The market reacted sensitively to news that Iranian leader Masoud Pezeshkian had officially requested a ceasefire, giving investors hope for de-escalation of the most acute energy crisis in recent years. Despite diplomatic glimmers, the US administration maintains a tough stance, setting an uncompromising condition: any peace talks will begin only after the Strait of Hormuz is fully open and recognized as safe for international shipping. This strategic waterway remains the main point of tension, as its blockade led to a record volume of oil fund trading at the end of March.

Asian markets rose yesterday. Japan’s Nikkei 225 (JP225) climbed 1.85%, China’s FTSE China A50 (CHA50) gained 1.50%, Hong Kong’s Hang Seng (HK50) rose 2.04%, and Australia’s ASX 200 (AU200) showed a positive result of 2.24%.

The NZD resumed its decline, falling to 0.571 US dollars and interrupting a two-day recovery. The main pressure factor was investor disappointment after Donald Trump’s prime-time address to the nation. Despite statements that the goals of “Operation Epic Fury” are almost achieved, the US President did not present a concrete plan for an immediate ceasefire. Although the RBNZ traditionally tries to “ignore” temporary price spikes, Breman made it clear that if inflation becomes persistent, the bank will have to raise interest rates again to prevent inflation expectations from rising.