Collinson FX: April 9: Oil prices collapse nearly US$20pb
by Collinson FX 8 Apr 17:29 PDT
9 April 2026
Callisto (NZL) - Admiral's Cup - July 2025 - Cowes UK © Richard Gladwell - Sail-World.com/nz
April 9, 2026: Market confidence surged following the agreement of a two-week ceasefire, which included the opening of the Straits of Hormuz.
Oil prices collapsed nearly US$20pb, while equities surged and bond yields tumbled.
Market sentiment exploded, on the announcement and now intense negotiations are underway, to find a permanent solution.
A long-term agreement will see markets brush off the current, temporary inflation crises and treat the last five weeks, as a momentary lapse in reason.
This is only the first step in a very volatile process, that could reignite at any time. The flight to the safety of the US Dollar was undone, with the EUR surging towards 1.1700, while the GBP blew through 1.3400.
The unwinding in the reserve allowed commodity currencies to regain lost ground, with the AUD breaking back towards 0.7050, while the NZD headed towards 0.5850.
The RBNZ left rates unchanged, as expected, but warned of action if the recent inflation crisis continued.
All eyes remain on the tensions and the military kinetics in the Middle East.
April 8: The shadow of the Iran war hangs over markets.
The US has imposed a deadline on Iran, coming later today, threatening unimaginable destruction upon the nation. Markets continue to trade nervously, ahead of the deadline, with equities in the negative and bond yields creeping higher.
Peace negotiations are ongoing, via an intermediary, so a positive outcome may come before further escalation.
The US Dollar was softer, with the EUR regaining 1.1550, while the GBP pushed back to 1.3260.
The softer reserve allowed commodity currencies to stabilise, with the AUD holding around 0.6950, while the NZD attempts to maintain 0.5700.
All eyes remain focused on the Middle East, although there will be local interest in the RBNZ, who are expected to hold rates.
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