EUROPEAN SESSION

In the European session, we have the German IFO survey. The IFO is correlated to the German Composite PMI given that they measure basically the same thing. The Business Climate index is expected to tick higher to 85.7 vs 86.4 prior, but whatever the data, the market reaction will likely be muted given no changes to the policy outlook and the focus on US-Iran stalemate.

AMERICAN SESSION

In the American session, we get the Canadian Retail Sales and the final University of Michigan Consumer Sentiment report. None of the data is going to change anything for the respective central banks, so the market reaction will likely be limited.

Having said that, today the price action might be mostly driven by hedging into the weekend risk given the heightened tensions between the US and Iran. Yesterday, we got reports saying that Iran has been deploying more mines in the Strait of Hormuz. Trump later seemed to confirmed that as he said on Truth Social that he ordered the US Navy to shoot and kill any boat that is putting mines in the Strait of Hormuz.

The only good thing that is holding everything from puking hard is the ceasefire. Just today the Israel and Lebanon ceasefire got extended by another three weeks and the US-Iran ceasefire looks to be open-ended. In the meantime, everyone has been restocking on their military power and the US has been sending more ships and military forces to the Middle East.

CENTRAL BANK SPEAKERS

• 08:00 GMT/04:00 ET – SNB Chairman Schlegel (neutral – voter)

This article was written by Giuseppe Dellamotta at investinglive.com.