Weaker amid North Korea reports, renewed US-China trade worries. All eyes on US-China trade talks for fresh direction. WTI (futures on Comex) is seen struggling to extend the recovery above the 62 handle, having reversed a sharp drop to 61.35 levels after a fresh risk-aversion wave gripped the European markets on the Yonhap report that North Korea fired unknown projectiles. The North Korean headlines added further to the soured sentiment, fuelled by the ongoing US-China trade spat and knocked-off the higher-yielding oil to daily lows. Over the last hours, the black gold is seen making minor recovery attempts, but upside appears to lack follow through, as markets refrain to place any big bets on the barrel of WTI heading into the crucial 2-day trade talks between the US and China that commences later today. The oil bulls manage to find some support from the ongoing rift between the US and Iran, with the US having imposed fresh sanctions on the Iranian metal industry a day before. ..

• The pair extended its sideways consolidative price action and is currently placed at the top end of the recent trading range, just below the key 1.3500 psychological mark. • The mentioned handle has been acting as a key barrier over the past one week or so and should now act as a key pivotal point for the pair's near-term directional move. Meanwhile, technical indicators on hourly/daily charts maintained their bullish bias and the fact that the pair has managed to hold its neck above important intraday moving averages - 100 & 200-hour SMA, support prospects for an eventual bullish breakout. However, weakness below 200-hour SMA might further reinforce the near-term range-bound price and accelerate the slide back towards challenging the 1.3400 round figure mark before the pair eventually drops to 50-day SMA support near the 1.3385-80 region. USD/CAD 1-hourly chart

Rabobank analysts point out that the US Census Bureau will release the trade balance for March and will be a key economic release for the day. Key Quotes “The first two months of the year showed some narrowing in the trade deficit, and a further decline may have President Trump believing that his tariffs are helping out. However, the recent narrowing of the trade deficit may have been driven by temporary factors such as a production stop in China during the lunar New Year, as well as the build-up of inventories in the US during the second half of last year.” “Once this inventory depletes, imports inevitably have to pick up pace again, putting renewed pressure on the trade balance.”

Danske Bank analysts note that the Norges Bank left the sight deposit rate unchanged at 1.00% in a decision widely expected by both markets and analysts. Key Quotes “The board concluded: 'The Executive Board's current assessment of the outlook and balance of risks suggests that the policy rate will most likely be raised in June' . In other words, the central bank sharpened the message from the monetary policy meeting in March, by more explicitly mentioning June as the timing of the next hike.” “In the evaluation of the domestic economy, Norges Bank mentioned capacity utilisation seems to be rising further, the labour market remains tight and wage growth is improving as expected. In addition, core inflation has been higher than expected and the import-weighted NOK is weaker despite a higher oil price.” “In summary, Norges Bank clearly clarified that markets should expect a rate hike in June, unless a considerable shock hits the economy. Our call remains that of two ad..

The cross breaches the key support at 123.00 the figure. The leg lower tracks the strong demand for the Japanese currency. US-China trade negotiations remain in centre stage. Souring risk sentiment continues to lend support to the safe haven JPY, in turn dragging EUR/JPY to fresh multi-week lows in the mid-122.00s. EUR/JPY focused on trade concerns The leg lower in the cross remains well in place on Thursday, posting weekly losses in three out of the last four weeks after failing to advance further north of the 200-week SMA near 126.70 in mid-April. The stronger demand for safer assets in the current context of risk aversion on the back of rising US-China trade concerns have been lending extra legs to the Japanese currency, therefore sustaining the down move in the cross. Later in the week, all the attention will be on the meeting between US and Chinese officials in Washington, with the trade agreement on top of the agenda of course and in light of the implementation of higher t..

Italian Prime Minister (PM) Giuseppe Conte was on the wires last minutes, via Reuters, noting that the European Commission’s forecasts on Italy are pessimistic. Earlier today, the Italian Finance Minister Tria noted that EU Commission will not demand additional budget measures. Recall that in its latest forecasts, the European Commission downgraded Italy's 2019 GDP growth projection to just 0.1% from 0.2% previously.

TD Securities analysts point out that the Norges Bank followed up its March rate hike with a pause today. Key Quotes “The Governor fine-tuned his guidance of future hikes, bucking the dovish trend of his G10 counterparts in saying that a June hike was now likely, meaning two hikes for the Norges Bank in the space of three months.” “We therefore adjust our forecast from a September hike to June, with no implication for the timing of future hikes.” “The clear signal for a June hike helps draw a line under recent NOK weakness. Larger concerns are likely to dominate, however, as investor attention remains focused on global trade and geopolitical tensions. Despite this, we think EURNOK may have peaked for this cycle and look for the cross to resume its grinding move lower.”

Reuters reports that the European Union (EU) and the foreign ministers of Germany, France and Britain on Thursday rejected the ultimatums after Iran announced it was scaling back curbs to its nuclear programme. The EU the statement read, with JCPOA referring to the Iran nuclear deal, “We reject any ultimatums and we will assess Iran’s compliance on the basis of Iran’s performance regarding its nuclear-related commitments under the JCPOA and the NPT (Treaty on the Non-Proliferation of Nuclear Weapons).” “We are determined to continue pursuing efforts to enable the continuation of legitimate trade with Iran,” it added. On Wednesday, Iranian President Rouhani threatened to resume high-level enrichment of uranium if world powers did not keep their promises under a 2015 nuclear agreement.