IRAN: US Centcom Says Strikes In Response To Attacks On US Warships

The AUD/USD had a range overnight of 0.6910-0.6978, Asia is currently trading around 0.6975. The AUD has outperformed across the board overnight as the market pins hope on the Pakistan request for a two-week ceasefire, both parties are apparently reviewing it ahead of Trump’s impending deadline. The USD price action has been poor but the strength of the AUD in particular overnight has been a standout. On the day, any hint of a ceasefire would see this relief rally have another leg higher but I err on the side of more disappointment for now. The pair is testing its first resistance around the overnight highs of 0.6980 and then the more important 0.7050-0.7100 pivot looms. Initial support on the day is toward the 0.6900-0.6930 area. Let's see if the market gets another “TACO” that it craves.

• Options : Closest significant option expiries for NY cut, based on DTCC data: 0.6850(AUD451m), 0.6875(AUD446m), 0.6980(AUD451m). Upcoming Close Strikes : 0.6750(AUD1.02b April 9), 0.6900(AUD1.49b April 9), 0.7050(AUD999m April 9) - BBG
• The AUD/USD Average True Range for the last 10 Trading days: 59 Points

 Fig 1: AUD/USD spot Daily Chart

Source: MNI - Market News/Bloomberg Finance L.P

February's consumer credit report was largely as expected, with the total credit increase of $9.5B near the $10.3B consensus, with January's revised down slightly to $7.7B from $8.1B prior. 

• The constituent flows were lopsided, however: revolving credit made up just $0.7B (+0.6%), a 3-month low, with nonrevolving $8.8B (+2.8%), a 5-month high. (Revolving makes up 25% of overall consumer credit, largely made up of credit cards; nonrevolving credit is basically made up of student and auto loans.)
• There's been no sign of a surge in either category, with income and wealth, not credit, continuing to fuel consumption, although PCE has shown signs of faltering somewhat. Total credit is up 2.3% Y/Y, which is actually the highest since early 2024, but revolving credit has been decelerating since strong gains late last year: 2.8% in Feb marks a 4-month low. Instead, it's been revolving credit picking up, to 2.1% Y/Y, a 31-month high, which has been driving the overall pickup of late.
• But either way these figures are relatively tame compared with overall GDP, inflation, and household income growth. 

Stock futures extend slightly higher (S&P eminis now up 0.1% on the day) with the USD at fresh lows, as multiple reports appear to suggest movement in both Washington and Tehran in considering the ceasefire proposal floated by Pakistan ahead of the putative 8pm ET deadline set by US President Trump.

• Reuters reporter on X.com: @PHREUTERS "SENIOR IRANIAN OFFICIAL TO REUTERS: TEHRAN POSITIVELY REVIEWING PAKISTAN’S REQUEST FOR A TWO-WEEK CEASEFIRE - Reuters News"
• Fox's Jacqui Heinrich on X.com, reaffirming the Axios report earlier that Trump was considering the ceasefire proposal with Iran from Pakistan: "Just had a short call with POTUS: He declined to say how he is feeling about negotiations: “I can't tell you, because right now we're in heated negotiations.” He declined to weigh in on Pakistan’s 2 week deadline extension request – saying he’s about to be briefed fully on it - but said: “I can say this - that I know him very well. He's a highly respected man, all over” Press Secretary Karoline Leavitt says, "The President has been made been aware of the proposal, and a response will come.""