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High beta FX and the yuan struggle in early...>

FOREX
FOREX: High beta FX and the yuan struggle in early trade this week, hindered by
weekend news flow, namely U.S. President Trump's China tariff escalation tweets
& to a far lesser extent, the latest round of North Korean missile tests. A
second round of risk-off flows came on the back of the latest WSJ sources piece
which suggested that China is considering cancelling this week's trade talks
with the U.S. after Trump's threats.
- JPY sits atop the G10 FX leader board, with USD/JPY trading 70 pips or so
lower at writing, last Y110.40, registering fresh lows in the last few minutes
as BBG reports that the U.S. national security advisor John Bolton has said that
the country is sending a bomber task force to act as a deterrent to Iran. Bolton
has noted that the U.S. isn't seeking a war with the Iranian regime.
- AUD & NZD the underperformers in G10, with USD/CNH trading ~1.3% or ~800 pips
higher, at CNH6.8160 at writing.
- A limited Asia-Pac session in terms of data flow, Chinese Caixin services PMI
provides the highlight. Headline risk around the official Chinese reaction to
Trump's tweet eyed.
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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