Major Currency Levels
EUR/USD traded near 1.1430, around levels last seen in August 2025. GBP/USD traded near 1.3240, around levels last reached in December 2025. USD/JPY traded near 159.60 after limited daily gains. AUD/USD traded at 0.7000 after slipping from 0.7100. WTI traded at $97 per barrel after government reserve releases failed to cap prices. WTI hit $119 per barrel on Monday, a level not seen since 2022, while gold traded at $5,044. The week includes central bank events and data from March 16–20, plus speeches through March 21. Scheduled items include the RBA, BoC, Fed, BoJ, BoE, SNB, ECB and PBoC decisions, with releases such as CPI, PPI, GDP, jobs data, trade figures, home sales, and business surveys.Conflict Driven Volatility
The ongoing conflict in the Middle East has injected extreme volatility into the markets, and we expect this to continue. With Iran’s closure of the Strait of Hormuz disrupting about a fifth of the world’s oil supply, the primary focus is on energy prices and the resulting inflation shock. Derivative traders should be positioned for sharp, unpredictable swings across all asset classes in the coming weeks. WTI crude oil’s recent spike to $119 a barrel, a level we last saw during the 2022 crisis, shows how sensitive the market is to supply disruptions. While prices have pulled back to $97, the upcoming weekly EIA inventory reports will be crucial for short-term price action. Option traders should note that implied volatility is extremely high, suggesting strategies that profit from large price movements could be more effective than simply picking a direction. The Federal Reserve’s interest rate decision on Wednesday is the week’s main event, as its previous outlook from January is now likely obsolete. Historically, a sustained $10 per barrel increase in oil can add significant upward pressure on headline inflation, complicating the Fed’s policy path. The US Dollar Index (DXY) pushing past 100 shows that capital is flowing into the Greenback as a safe haven, a pattern we also observed in past crises. We are seeing significant weakness in currencies of energy-importing nations, with EUR/USD falling to levels last seen in August 2025. The Eurozone is particularly vulnerable to an energy price shock, which will put the European Central Bank in a difficult position during its meeting this Thursday. Traders should watch for any divergence in policy tone between the Fed and the ECB, which could fuel further currency trends. The Japanese Yen’s traditional safe-haven status is creating a complicated picture for USD/JPY, which is struggling for direction near its two-year high. Conversely, risk-sensitive currencies like the Australian Dollar are clearly under pressure, with AUD/USD breaking below the 0.7100 handle. This risk-off sentiment is likely to persist as long as geopolitical tensions remain elevated. A cascade of central bank meetings from the Fed, ECB, BoJ, SNB, and BoE next week means monetary policy will be a huge driver. We anticipate that policymakers will be forced to address the dual threat of rising inflation and slowing growth caused by the energy shock. The official statements and press conferences will be scrutinized for any shifts in economic projections, providing the next major catalyst for the market. Create your live VT Markets account and start trading now.
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