
Risk correlations appeared to break down again on Thursday, as crude oil took cues from geopolitical updates while dollar traders seemed more wary of weak PPI data and the U.S. budget bill.
The focus shifted to Iran, moving closer to possibly signing a nuclear deal with the U.S. in exchange for sanctions being lifted, but the market optimism fizzled as the day went on.
Here are headlines you may have missed in the last trading sessions!
Headlines:
- NBC News reported that Iran is ready to sign a nuclear deal with the U.S., according to a top adviser to Iran’s supreme leader, in exchange for relief from oil sanctions
- France CPI (Final) April 2025: 0.6% m/m (0.5% m/m forecast; 0.2% m/m previous)
- U.K. Labour Productivity q/q March 31, 2025: 0.2% q/q (0.7% q/q previous)
- Euro area Industrial Production for March 2025: 3.6% y/y (2.2% y/y forecast; 1.2% y/y previous); 2.6% m/m (1.5% m/m forecast; 1.1% m/m previous)
- Euro area GDP Growth Rate q/q for Q1 2025: 0.3% (0.4% forecast; 0.2% previous)
- Euro area Employment Change (preliminary) for March 2025: 0.8% y/y (0.8% y/y forecast; 0.7% y/y previous); 0.3% q/q (0.4% q/q forecast; 0.2% q/q previous)
- German Finance Minister Lars Klingbeil expressed optimism that US-EU trade negotiations can yield good results, but that bloc should respond to tariffs with “unity and determination.”
- EU Commissioner for Trade and Economic Security Maros Sefcovic agreed with U.S. Commerce Secretary Lutnick to accelerate EU trade talks
- U.K. NIESR Monthly GDP Tracker for April 2025: 0.6% (0.7% forecast; 0.6% previous)
- U.S. Treasury Secretary Bessent reminded that they are entering a series of negotiations with China
- Canada Housing Starts for April 2025: 278.6k (212.0k forecast; 214.2k previous)
- U.S. Retail Sales for April 2025: 0.1% m/m (-0.1% m/m forecast; 1.4% m/m previous); Core Retail Sales: 0.1% m/m (0.1% m/m forecast; 0.5% m/m previous)
- U.S. Philadelphia Fed Manufacturing Index for May 2025: -4.0 (-10.0 forecast; -26.4 previous)
- U.S. Producer Prices Index Growth Rate for April 2025: -0.5% m/m (0.2% m/m forecast; -0.4% m/m previous); 2.4% y/y (2.6% y/y forecast; 2.7% y/y previous); core PPI: 2.9% y/y (3.4% y/y forecast; 3.4% y/y previous); -0.1% m/m (0.1% m/m forecast; 0.1% m/m previous)
- U.S. NY Empire State Manufacturing Index for May 2025: -9.2 (-9.6 forecast; -8.1 previous)
- U.S. Weekly Initial Jobless Claims for May 10, 2025: 229.0k (220.0k forecast; 228.0k previous)
- Fed Chairperson Powell discussed the consensus that rhetoric on jobs and inflation should be reconsidered and that revisions to Fed communication are needed
- Fed official Barr acknowledged that the U.S. economy is on solid footing, but the trade outlook adds uncertainty
- U.S. Manufacturing Production for April 2025: 1.2% y/y (0.8% y/y forecast; 1.0% y/y previous); -0.4% m/m (-0.2% m/m forecast; 0.3% m/m previous)
- U.S. President Trump said that they are getting closer to a deal with Iran and that India offered a zero-tariff deal
- U.S. Capacity Utilization Rate for April 2025: 77.7% (77.8% forecast; 77.8% previous)
- U.S. Industrial Production for April 2025: 0.0% m/m (-0.1% m/m forecast; -0.3% m/m previous); 1.5% y/y (0.9% y/y forecast; 1.3% y/y previous)
- U.S. Business Inventories for March 2025: 0.1% m/m (0.1% m/m forecast; 0.2% m/m previous)
- U.S. NAHB Housing Market Index for May 2025: 34.0 (40.0 forecast; 40.0 previous)
Broad Market Price Action:

Dollar Index, Gold, S&P 500, Oil, U.S. 10-yr Yield, Bitcoin Overlay Chart by TradingView
Markets seemed to open on a risk-off mood early Thursday, as higher-yielding assets like commodities and crypto were on the back foot during the Asian session.
WTI crude oil turned lower after NBC News released a report citing a top adviser to Iran’s supreme leader who said that the country is moving closer to signing a nuclear deal with the U.S. in an attempt to have oil sanctions lifted. This spurred a pickup in global supply forecasts, weighing heavily on the energy commodity for the rest of the session until it rebounded during London market hours when the odds of an immediate agreement seemed slim.
Gold’s price continued to shed its safe-haven gains, dipping below the $3,150 mark during Asian market hours, before pulling back higher as risk-off flows appeared to return and dollar weakness ensued on the heels of mostly downbeat U.S. data later in the day. The precious metal closed more than 2% higher as it climbed back above the $3,200 area by the end of the New York session.
Bitcoin seemed to trail the precious metal in its topsy-turvy run, with the altcoin falling to the $102K support zone then recovering back to intraday highs before closing with marginal gains.
Treasury yields, which had slowly been cruising lower for most of the day, took an even steeper tumble upon seeing weaker-than-expected U.S. retail sales and PPI that likely boosted odds of further Fed easing. It didn’t help that dollar traders might also be increasingly concerned about the fate of the U.S. budget bill in Congress, plus the growing likelihood of a ballooning government deficit.
U.S. equities managed to pull higher during U.S. market hours, drawing some support from dovish Fed expectations resulting from data misses, as well as sustained market optimism for U.S.-China negotiations and another tech sector-led stock rally.
FX Market Behavior: U.S. Dollar vs. Majors:

Overlay of USD vs. Major Currencies Chart by TradingView
It was a busy day in the forex market, as traders had to deal with a handful of top-tier and mid-tier releases that spurred mixed price action among the majors.
Australia reported stronger-than-expected employment data for April, but the Aussie was unable to sustain its bullish reaction and instead gave up ground to overall risk aversion in the markets during the Asian session. Only USD/JPY was able to maintain its bearish trajectory throughout the session, as the lower-yielding yen also drew support from safe-haven flows and the Asian currency revaluation narrative.
Dollar pairs saw a brief but broad-based drop around the start of the London session, right around the release of stronger-than-expected U.K. GDP and underlying metrics, with the Swiss franc even chalking up gains despite downbeat PPI results. The euro also took advantage of USD weakness thanks to mostly upbeat regional industrial production and employment data, as well as remarks from EU leaders reinforcing their trade position.
However, USD losses were short-lived as risk-off vibes appeared to extend their stay, dragging AUD/USD and NZD/USD deeper in the red before net negative U.S. data kept dollar gains in check. Although the headline U.S. retail sales figure turned out better than expected, with a meager 0.1% uptick, the core version of the report and producer prices data all fell short of estimates.
Fed head Powell’s speech did little to steer USD pairs in a clear direction since he merely talked about needing to revise their communication strategy moving forward.
Upcoming Potential Catalysts on the Economic Calendar:
- New Zealand Business Inflation Expectations at 3:00 am GMT
- BOJ official Nakamura’s Speech at 4:00 am GMT
- Japan Industrial Production at 4:30 am GMT
- France Unemployment Rate at 5:30 am GMT
- Swiss Industrial Production at 6:30 am GMT
- Euro area Trade Balance at 9:00 am GMT
- Canada Foreign Securities Purchases at 12:30 pm GMT
- U.S. Building Permits at 12:30 pm GMT
- U.S. Housing Starts at 12:30 pm GMT
- U.S. Import & Export Prices at 12:30 pm GMT
- U.S. University of Michigan Consumer Sentiment Index at 2:00 pm GMT
- ECB official Lane’s Speech GMT
- U.S. TIC Net Long-Term Transactions at 8:00 pm GMT
There’s not much in the way of top-tier data points on today’s economic schedule, although the UoM preliminary sentiment index for May will be worth keeping tabs on since it provides the earliest glimpse into the U.S. consumer sector and spending conditions.
Apart from that, be sure to keep your eyes and ears peeled for geopolitical headlines and trade developments that could impact overall market sentiment, as well as updates on the U.S. budget bill in Congress.
As always, stay nimble and don’t forget to check out our Forex Correlation Calculator when taking any trades!
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