USD

* US Sen Grassley says president Trump is inclined to impose car tariffs.

* Grassley also says that govt shutdown may also delay trade talks.

* Chinese FDI (foreign direct investment) in the US falls significantly.

* Philly Fed manufacturing index due out this afternoon.

GBP
* PM May statement last night urged parliament to come together and find a way forward and a deal which appeals to all.

* Party leaders met with PM May last night, with the exception of Labour leader Corbyn who insists she rules out no deal first.

* At least 130 UK business leaders have urged parliament to seek a second referendum.

* UK Dec RICS House Price Balance falls to its lowest level since Aug 2012; -19.%.

EUR

* EU CPI out this morning – second reading expected to confirm a headline rate of 1.6% while the core rate sticks at 1.0%.

* German govt looking for ways to exclude Huawei from 5G auction.

* ECB’s Lautenschlager speaking later today – yesterday said not surprised by the dip in inflation, still sees economy within ECB forecasts.

AUD & NZD

* Risk sentiment will dictate price action in the related currencies – NZD the underperformer, now a cent off the recent highs.

* AUD also down as Chinese growth concerns will continue to put a cap on the commodity linked currency.

* Australian home loans for Nov fell 0.9%, though a drop of 1.5% expected.

CAD

* Also feeling the turn in risk sentiment, USD/CAD pushes back above 1.3300 this morning.

* Canadian ForMin Morneau says Brexit will not affect Canada but will impact on global economy.

* Oil prices holding their ground, though off the recent highs.

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