EUR/CAD remains below 1.1700 due to increased risk aversion
EUR/USD steadies after three days of losses, trading around 1.1690 during the Asian hours on Friday. The pair remains flat as the US Dollar (USD) maintains its position as safe-haven demand increases amid persistent uncertainty surrounding the United States (US)–Iran conflict.
Bloomberg reported on Thursday that the US military intercepted two Iranian oil supertankers attempting to evade its blockade, as Washington continues efforts to restrict Iran’s shipping while Tehran threatens vessels in the Strait of Hormuz.
US President Donald Trump warned that if Iran does not move its oil, its infrastructure would be targeted. Iranian officials, however, denied agreeing to any extension of the truce and accused Washington of breaching it by maintaining a naval blockade on Iranian trade.
Trump also said Israel and Lebanon would extend their ceasefire by three weeks, according to Bloomberg. The move could open the door for a longer-term agreement between the two countries and remove a key obstacle to ending the US conflict with Iran. He added that he plans to host Israeli Prime Minister Benjamin Netanyahu and Lebanese President Joseph Aoun in the near future.
The Greenback found additional support from resilient US economic data. Weekly Initial Jobless Claims rose to 215K from 212K, indicating continued strength in the labor market. Meanwhile, S&P Global PMIs surprised to the upside, with Manufacturing at 54.0 and Services at 51.3, pointing to sustained expansion in business activity.
The Eurozone’s preliminary HCOB Composite PMI unexpectedly declined to 48.6 in April, missing expectations of 50.2 from 50.7 in March. Germany’s flash Composite PMI also fell short, dropping to 48.3 versus forecasts of 51.1, compared to 51.9 in the prior month.
The Eurozone’s private sector contracted in April at the fastest pace since November 2024, as the Iran conflict pushed energy costs higher, weighing on consumer demand and the services sector. Meanwhile, Germany’s Economics Ministry halved its 2026 growth forecast, citing the energy shock stemming from the Middle East conflict.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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