Asian equities traded mostly higher in what was a particularly quiet session overnight. FX markets saw USD/JPY break back below 109.00

US President Trump announced that the US plans to continue sending troops to Afghanistan to fight the terror tspaneat

Looking ahead, highlights include UK PSNB data, German ZEW and APIs

ASIA

Asian equity markets were mostly higher although news flow was remarkably light amid a lack of central bank speakers and macroeconomic data. Focus was on a speech from US President Trump where he highlighted US plans to continue sending troops to Afghanistan to fight the terror tspaneat emanating from the country. The Nikkei 225 rose 0.1% while the ASX 200 was up 0.3% after numerous earnings, including from BHP Billiton.

10y JGBs were lower despite a strong 20y JGB auction as participants move into the long-end following the well-received issuance, leading to curve flattening. The line was sold with the lowest tail of 2017 and highest cover since January 2014.

EUROPE/UK

Newsflow from the region remains light overnight

FX

The JPY was the main mover in FX markets, weakening as USD/JPY broke back above 109.00 with reports suggesting strong demand in the pair from Tokyo names in early Asia-Pac trade. US President Trump’s speech on Afghanistan may also have not been as controversial or aggressive as some had been expecting. Meanwhile, China set the CNY at its strongest level against the USD in 11-months stemming from the recent USD weakness.

PBoC set CNY mid-point at 6.6597 (Prev. 6.6709)

COMMODITIES

OPEC/Non-OPEC JTC reportedly sees July production deal compliance at 94%. (Newswires)

Kuwaiti oil minister said that OPEC will discuss ending or extending cuts at its November meeting. He also noted that OPEC is still working to push oil stocks below 5-year average. (Newswires)

US

US treasury trade was relatively listless, with bonds operating in a narrow range and remaining bid tspanoughout the US session. Sep’17 10y T-note futures settled at 126.27, up 3 ticks.