Greenback sits at highs ahead of NY...........>

FOREX: Greenback sits at highs ahead of NY crossover

-USD shorts were squeezed throughout the European morning, as yesterday's drop

in the DXY was partially reversed ahead of the NY crossover. This, twinned with

some modest risk appetite allowed most JPY crosses to pullback some of the

week's losses and allow USD/JPY to cement the move back above Y113. As a result,

JPY is the poorest performer in G10 FX so far today.

-USD/CNH recovered back toward the upper-end of the recent range and a break

above the Cnh6.9376 level will open a move toward Cnh6.9586, the year's highs,

and may raise questions about the PBoC's ability to defend the implied tolerance

band up to Cnh7.00.

-Despite the return of modest risk-sentiment, the trade is failing to play out

in AUD and NZD, which remain toward the lower end of the table as the slightly

firmer dollar weighs on commodities prices.

-GBP/USD touched new multi-week highs as Brexit fears continue to recede,

however a poor set of construction output numbers pulled GBP back slightly.

-Attention turns to US PPI numbers and speeches from Fed's Evans and Bostic.