GBP lurches higher as Merkel may concede......>

FOREX: GBP lurches higher as Merkel may concede five-year limit to backstop

-After a relatively sanguine start to the trading day, GBP/USD spiked above the

$1.31 mark, re-approaching the 21-dma at $1.3157 as BBC's Newsnight reported

that Brexiteer lawmakers have received word that German Chancellor Merkel may be

willing to place a five-year time limit on the problematic backstop in Northern

Ireland, thereby easing the passage through parliament should May's proposed

deal be voted on again.

-Greenback trades on the back foot for a second session, with EUR/USD climbing

to the best levels since Mar27th. Options markets are moving in tandem, with

EUR/USD 1m risk reversals hitting three-week highs also. Modest support for risk

appetite stemmed from MNI source reports writing that "EU and Chinese

negotiators have made sufficient progress" on a number of topics. Equity futures

in Europe outperform, but US markets sit slightly lower.

-The data calendar is particularly quiet with no tier 1 releases due from the US

or Canada. Central banks are quiet also ahead of the ECB decision and FOMC

minutes tomorrow.