Themes

· General mood is “risk off”

· USD bid emerges on early Asian session trade

· Japanese Employment and Industrial Production weaker; Retail Sales stronger

What’s Moving

We opened relatively quietly this morning in Asia after the overnight U.S. holiday, but once the market got going, it got going with a decent USD bid. This move was likely on the back of short covering after recent Dollar weakness and ahead of tonight’s U.S. trade after a three-day weekend.

Best early Dollar gains were against the Yen and CHF. With the Yen seeing gains on the weaker early local Industrial Production and Employment numbers.

Chinese PMI numbers both came in hotter than expected, while it was a mixed bag in Australia with Building approvals weaker than expected, but the Current Account was better than expected.

It should be an interesting session tonight, with the U.S. back from a three-day weekend. The Dollar is significantly weaker since they last saw it and risk is for a short-covering bounce.

Data tonight sees:

· French CPI (E: +0.7%)

· French GDP (E: 0.0%)

· Euro-zone CPI (E: 7.8%)

· Canadian GDP (E: +0.5%)

· U.S. Chicago PMI (E: 55.0)