Signs of further strain on China's............>

FOREX: Signs of further strain on China's relations with the U.S. and Australia

weighed on broader risk appetite. AUD led commodity FX lower and landed at the

bottom of the G10 pile, as local press reported that Beijing has blacklisted

meat imports from four Australian abattoirs. A bid in JPY allowed USD/JPY to

retreat below its 50-DMA and Y107.50, a former breakout level penetrated y'day.

EUR/JPY flirted with the Y116.00 mark, but failed to consolidate below. USD

showed some strength, but it dissipated with DXY falling towards neutral levels.

- USD/KRW opened higher on the back of yesterday's broad-based demand for the

greenback. Risk aversion pushed the rate higher still and the won is heading for

the London session as the worst performer in Asian EM FX.

- USD/CNH was happy to hold a tight range, unfazed by China's international

disputes and weak local data. CPI inflation slowed more than projected, while

factory-gate deflation was deeper than forecast. 

- U.S. CPI and Norwegian GDP take focus from here. ECB's Stournaras & Fed's

Bullard, Kashkari, Harker, Quarles and Mester will make comments today.