Italian & North Korean Developments...........>

FOREX: Italian & North Korean Developments Underscore Risk

- The EUR garnered a bid after the Italian President blocked the formation of

the M5S/League gov't as the parties proposed euro-sceptic Savona as their

economy minister. The move will likely send Italy back to the polling booths.

- JPY was on the back foot as the June 12 US-North Korea summit seemed a more

likely proposition than it did 48 hours ago, with US President Trump seemingly a

little more upbeat on the matter in comments made over the weekend. However, a

degree of the JPY's weakness was reversed around the Tokyo fix, with USDJPY back

to unchanged levels ~109.40 after the 21-DMA capped the cross.

- AUD & NZD benefitted from the uptick in risk, with both adding around 30 pips

against the USD.

- CAD fell afoul of the continued slump in oil prices, with USDCAD last ~1.2990.

- With the US & UK on holiday focus is set to fall on the Italian & North Korean

developments. Monday's Docket is thin, with ECB's Villeroy set to speak. Notable

risk events later in the week include the US labour market report, US Q1 GDP 2nd

estimate, US PCE, EZ CPI, BoC MonPol decision & Canadian GDP.