Sterling under early pressure in Europe as....>

CABLE: Sterling under early pressure in Europe as cable gets pressed down to

$1.3098, after rate saw a tight range in Asia of $1.3111-29. Move has seen

Eur/Gbp edge back above Gbp0.8900, after holding Gbp0.8891-0.8900 in Asia,

extending the topside to Gbp0.8909. Cable currently trades around $1.3103, the

cross around Gbp0.8904. Focus this morning on UK Inflation data at 0930GMT.

Market median for headline CPI seen at 3.1%yy(BOE staff 3.2%) which if proves

correct to prompt a letter from BOE Carney to the Treasury(published after

data). Political concerns weighed on sterling Monday, though the pound was able

to pare back some of its losses in NY. Brexit Bill amendments/voting could also

provide reaction. Cable support now seen between $1.3090/80, a break to expose

Monday's low of $1.3063. Resistance $1.3130/35, a break here seen needed to

begin negating current underlying downside pressure. 

Options: Expiries for today's NY cut - $1.3150(Gbp651mn), $1.3300(Gbp810mn)