From Marc Chandler at Bannockburn Global Forex:
The markets remain on edge. President Trump’s five-day hiatus announced yesterday is looked upon suspiciously. Much of what has been claimed seems to be part of the psych-operations associated with warfare, like initiating the war during negotiations. Many seem to share our sense that the five-day period will allow more US troops to enter the region and perhaps attempt to take Kharg Island. The US strategy seems to waver between destroying Iran’s capability to even make a paperclip to seeking regime change and keeping the energy infrastructure intact to allow the new regime to rebuild. Meanwhile, more ships appear to be passing through the Strait of Hormuz, which appears becoming a toll booth for $2 mln passage fee to be paid in yuan. Meanwhile, the US has given Europe an ultimatum of its own: Agree to the trade deal by March 26 of lose favorable access to the US liquified natural gas.
Follow-through dollar selling has been limited today after yesterday’s setback. The market lacks near-term conviction. The preliminary March PMIs were mostly weaker, and this is only the initial inkling of the disruptive impact of the war. Yesterday’s hopeful optimism has yielded to a more wary stance today....
....MUCH MORE
