Last week ended badly for risk. As both equities and yields fall it is clear that global growth expectations continue to be pared back. However, given the Labor Day holiday in the US today the risk is for a ranging respite in FX markets with the likes of GBP/USD holding between 1.6110 and 1.6255. EUR/CHF short covering ended early last week, but the subsequent mark down appears to have encountered fresh demand. In turn, this could also mark the onset of a period of stability.
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