STIR markets have seen a slightly risk-on......>

STIR: STIR markets have seen a slightly risk-on tone this morning on the back of

headlines overnight that suggest a memorandum of understanding was being drawn

up between the US and China regarding trade. The Eurodollar strip is 1-2 ticks

lower across the curve. Later today will see December durable goods orders and

January existing home sales data released but there are no Fed speakers

scheduled.

- The Euribor curve has seen Greens and Blue 1.5-2 ticks lower on the day, Reds

0.5-1.5 ticks lower and Whites within 0.5 ticks of yesterday's close. This

morning's PMI data was mixed with French services and manufacturing both beating

expectations, as did Eurozone and German services. However, there was a large

drop in the German manufacturing PMI which fell to its lowest level for over six

years.

- The short sterling strip has also moved lower with Whites flat to 1 tick

lower, Reds 1 tick lower and Greens and Blues generally 1.5 ticks lower on the

day. UK public finance data was better than expected with tax income and capital

gains tax revenues higher than expected but politics remains the driver.