-After a relatively quiet European session,...>

FOREX: -After a relatively quiet European session, ratings agency S&P triggered

a wave of sterling sales after warning that a no deal Brexit would result in a

lengthy recession, adding that the risk of a no deal has increased to the point

where it has become a ratings consideration. GBP/USD briefly fell through $1.27

handle, with markets now eyeing an attempt on the year's worst levels of

$1.2662.

-Meanwhile, the USD index continues to creep higher, coming within 0.05% of the

year's highs printed in August. Equities continue to look fragile ahead of

month-end and the volatility may extend into Wednesday, with month-end flows and

rebalancing models kicking into action.

-AUD and NZD performed well Tuesday, rising against all others in G10, but the

recovery from recent lows looks increasingly shallow as the commodity complex

continues to weaken. AUD/USD needs to recover above $0.7160 to change this.

-Focus Wednesday turns to Australian CPI, the Bank of Japan rate decision,

Eurozone CPI estimates and US Chicago PMI. Speeches from ECB's Nowotny, Hansson,

Visco and Nouy are also due.