Stellar sterling as market bets on............>

FOREX: Stellar sterling as market bets on compromise

-GBP was comfortably the top performer in G10 Tuesday as markets eyed Bloomberg

reports suggesting that the tone of both Germany's Merkel and France's Macron

softened at the G7 summit. According to the piece, the perceived moderation in

the EU's stance opens room for compromise with the UK, which led to GBP/USD

rallying north of $1.23 for the first time since end-July.

-JPY wasn't far behind GBP, as a turnaround in US equity markets undermined

firmer European indices, as lower banking stocks dragged USD/JPY back below the

Y106 handle. This kept markets well within range of the week's low at Y104.46

printed early Monday.

-At the other end of the table, commodity-tied FX underperformed, with NZD and

CAD slipping. AUD also traded lower, but was spared the bulk of the losses

thanks to firmer gold and silver prices.

-Another quiet data day Wednesday, with just Italian consumer confidence on the

docket. Speaker slate is slightly busier as attention turns to appearances from

Fed's Barkin and Daly.