Westpac's G10 FX model "dials back its USD....>

FOREX: Westpac's G10 FX model "dials back its USD bearish stance compared to

last week as yield support firmed but it remains a meaningful -23% of portfolio

exposure, the short bias overall mostly a function of the sharp improvement in

the risk environment in recent weeks via our short term macro momentum logit

signal. The model re-enters a decent NZD short, outperformance in kiwi rates a

major catalyst. The model has been incorrectly bullish JPY for many weeks but

has finally dialed back its enthusiasm, a weaker growth signal following last

week's soft PMI and retail sales data the main trigger points. NOK remains the

favoured long, the positive risk environment, underperformance in NOK rates and

a decent growth signal driving the model."