Iran vows to enrich uranium “without restrictions”

Ross J Burland FXStreet

Iran's government has announced today that it would no longer abide by any limits on its enrichment of uranium, according to Iranian state TV, raising the risk that Iran will move toward a nuclear weapon and bound to antagonise the US in the latest escalation of tensions between the two nations.

However, Iran has said it will continue to allow inspections by the International Atomic Energy Agency (IAEA) and is prepared to return to compliance with the deal if the US removes sanctions.

Key notes

European leaders have attempted to mediate in order to keep constraints on Iran's nuclear program intact.
The Trump administration says its goal is to force Iran to negotiate a more comprehensive deal, though that seems a remote prospect given the current realities.
Iran announces new step to distance itself from 2015 nuclear deal with major powers.
Iran says its uranium enrichment work will have no limitations, Tehran will enrich uranium based on its technical needs.
Iran will continue its cooperation with UN nuclear watchdog.
Iran's rolling back of its nuclear commitments is reversible if the US lifts sanctions on Tehran.

Market implications

President Trump withdrew the US from the deal in May 2018, setting off a chain of events that have seen tensions rise to the point where the two countries may now be on the brink of war. Following the killing of Qassem Soleimani, head of Iran's elite Quds Force and the promise of retaliation, market participants are bracing themselves for heightened volatility with oil prices likely to go up amid possibilities of a full-blown conflict between two of the biggest oil-producing nations

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

AUD/USD shows resilience below 38.2% Fibo. near mid-0.7100s

The AUD/USD pair touches a one-and-a-half-week low, around the 0.7140 region during the Asian session on Monday, though it lacks follow-through. Spot prices currently trade just above mid-0.7100s, down nearly 0.25% for the day.

USD/JPY: Japanese Yen edges lower vs USD amid Middle East jitters as Fed, BoJ meetings loom

The USD/JPY pair attracts some buyers at the start of a new week and climbs closer to the 154.00 mark during the Asian session, reversing a part of Friday's losses. Spot prices, however, remain confined in a range held over the past week or so and within striking distance of a nearly seven-month low, touched last Tuesday, as traders await this week's key central bank events.

Gold retests $4,300; USD losses momentum

Gold picks up fresh upside traction and challenges the key $4,300 mark per troy ounce on Monday. The yellow metal, however, remain on the back foot on the back of marked gains in the US Dollar and rising US Treasury yields across the curve.

Crypto Today: Bitcoin, Ethereum, XRP recover ahead of US Senate vote on CLARITY Act

Bitcoin edges higher, trading near $77,884 as of Monday, in tandem with broader gains across the cryptocurrency market. Ethereum and Ripple follow Bitcoin’s neutral-to-bullish trajectory, holding key support levels at $2,521 and $1.38, respectively.

Will the Fed deliver the hawkishness markets are pricing in?

Fed hike bets increase after PPI and CPI reports. Updated dot plot to be crucial for the dollar’s reaction. Warsh’s independence faces test amid Trump’s pressure for lower rates. For the Dollar to extend gains, Fed needs to satisfy current hawkish bets.

Venezuela’s 65-billion-barrel Oil deal could reshape America’s inflation fight

The United States (US) has secured unprecedented access to part of Venezuela’s vast Oil reserves. The timing is particularly significant as the war with Iran is disrupting Middle Eastern supplies, keeping energy prices elevated and reviving concerns about inflation.