MIDEAST: Extended Lebanon Ceasefire Dials Down Tensions, But Risks Abound

Of note:

EURUSD 1.82bn at 1.1605 (could act as magnet).

USDJPY 2.96bn at 158.00 (a little far).

AUDUSD ~1bn at 0.6990.

EURUSD 1.52bn at 1.1600 (thu).

• EURUSD; 1.1575 (440mln), 1.1580 (930mln), 1.1605 (1.82bn), 1.1625 (254mln), 1.1675 (974mln).
• USDJPY: 158.00 (2.96bn).
• USDCAD: 1.3785 (423mln), 1.3800 (591mln).
• AUDUSD: 0.6950 (1.42bn), 0.6990 (965mln), 0.7000 (375mln).
• USDCNY: 6.9000 (603mln).

• MNI: GERMANY MAR IFO BUSINESS CLIMATE INDEX 86.4

Reuters, citing Iran's semi-official IRNA, reports that according to the Iranian ambassador to Pakistan, "there [were] no talks between the US and Iran, either directly or indirectly." Adds that "Friendly countries like Pakistan seek to lay the ground [for] dialogue between Tehran and Washington," and hppes these efforts can help in ending the war. 

• These comments continue the lengthening list of contradictory statements emerging from Tehran and Washington, D.C. US President Donald Trump claimed in an address on 24 March that his administration is "talking to the right people" in Tehran, and that "they want to make a deal so badly". Trump also claimed that Iran had gifted the US a "very significant price" related to O&G and the Strait of Hormuz.
• There remains little actual signal as to how the conflict could end. The US is ramping up its troop deployment in the region, raising the prospect of a ground offensive around the Strait of Hormuz, Kharg Island, or even Iran's nuclear sites.
• There is also significant uncertainty regarding the potential actions of the Gulf states, whose infrastructure continues to come under daily attack from Iranian drones and missiles. Reports on 24 March suggested these countries were considering entering the fray, which would mark a major new step in the conflict.