Markets await the outcome of negotiations between Iran and Oman and if the potential agreement includes the opening of the Straits of Hormuz. Expectations are not high and equity markets opened the week on a negative note, while bond yields pushed higher. The US Dollar was steady, with the EUR trading 1.1540, while the GBP holds around 1.3500.Commodity currencies drifted off recent levels, with the NZD coming off 0.5900, while the AUD fell back to 0.7050. Much of the attention was given to Japan and the Yen, which has been supported by the recent coordinated intervention, from both the US and the Bank of Japan. The BoJ released the minutes of their last meeting, confirming interest rates will go higher and at an increased pace. This is in an effort to quell energy induced inflation rises, but has sparked a reversal of the Yen carry trade, as rates rise and the currency requires support.
