Risk was firmly back in favour through........>

FOREX: Risk was firmly back in favour through Tuesday's Asian session and into

the European morning. Markets picked up on an FT headline that the White House

is considering removing some of the tariffs impose on China, though the full

story was heavily caveated. UST yields continued to push higher, which in turn

took USD/JPY to extended highs of Y108.83, remaining firm late Europe morning.

The USD buoyancy helped to keep at bay any risk driven lift in EUR/USD, the rate

meeting resistance at $1.1140, where Monday's pullback met support ahead of the

Europe close. Cable made a show to $1.2904 but the much reported large option

expiry at $1.2900 helped to keep it in check (Gbp1.5bln roll off at the NY cut,

Gbp1.28bln of GBP calls). Rate retested Monday lows of $1.2876 on reversal but

managed a bounce back toward $1.2900 following release of stronger than forecast

UK Svcs PMI data(though details disappoint). The general risk on tone, with

China trade link, allowed USD/CNY to dip under Cny7.00, while USD/CNH broke

below its 100-dma. Commodity currencies all fared well.

- US Trade and US non-mfg ISM provide focus into the US session.

- FED Barkin(1300GMT), Kaplan(1740GMT) and Kashkari(2300GMT) due to speak.