Sterling Unnerved By Brexit Stalemate

Sterling retreated after weekend press coverage suggested that brinkmanship in UK-EU negotiations is bound to continue, while PM Johnson will set an Oct 15 deadline for reaching a deal. Separately, the FT reported that the UK is planning to rip up parts of the current withdrawal agreement with Brussels. GBP lagged all of its peers from the G10 basket, as participants digested the news. The next round of bilateral talks kicks off on Tuesday.

• NZD traded on a softer footing as domestic focus fell on an op-ed by RBNZ Gov Orr, who reaffirmed that New Zealand's central bank is actively preparing additional monetary policy tools, including negative interest rates and direct funding for banks. There was nothing shocking or new in Orr's comments, but the Kiwi struggled nonetheless.
• AUD held up well, with BBG trader sources pointing to purchases against NZD in reaction to the aformentioned messaging from RBNZ Gov Orr.
• The U.S. observes the Labour Day holiday. In Asia, Thailand was off for the Songkran Festival.
• German and Norwegian industrial output data take focus from here.