GLOBAL: (Axios) Major U.S. banks are detecting unauthorized third-party [...]

• The 1y1y GBP/EUR cross-currency spread is back flirting with 150bp and threatening to test last week’s lows of ~145bp as energy eases on more positive headlines out of the Middle East. 

• 1y1y GBP is down to ~4.77% versus last week’s highs above 5%. The UK front-end's higher positive beta to the energy complex is cutting through the tight correlation that has characterized 1y1y GBP and ESTR in recent months.

  

Of Note:

EURUSD 1.47bn at 1.1500.

USDJPY 1.2bn at 158.00.

EURUSD 1.4bn at 1.1500 (wed).

USDCNY 1.02bn at 6.7030 (wed).

EURUSD 1.47bn at 1.1500 (thu).

USDJPY 1.46bn at 157.50 (thu).

USDCAD 1.27bn at 1.4100 (thu).

EURUSD 1.12bn at 1.1500 (fri).

EURUSD 2.62bn at 1.1500 (mon).

AUDUSD 1.05bn at 0.7100 (mon).

• EURUSD: 1.1425 (350mln), 1.1440 (240mln), 1.1460 (310mln), 1.175 (300mln), 1.1490 (441mln), 1.1500 (1.47bn).
• GBPUSD: 1.3380 (324mln).
• USDJPY: 157.00 (897mln), 158.00 (1.2bn).
• AUDUSD: 0.7100 (457mln).

Bund futures jumped to a high of 121.36 on solid volumes following positive news flow surrounding the US-Iran war. However, RXZ6 is back at 121.10 at typing, -1 tick versus yesterday’s settlement levels.

• Al Jazeera noted that the IRGC said “if our national interest requires us to conduct negotiations alongside the war, then we must negotiate” (albeit alongside some harder line rhetoric) and Kyodo News reports “Iran has informed the Trump administration that it will open the blocked Strait of Hormuz "within seven days" if it accepts demands such as lifting the US military blockade of Iranian port”. However, Iranian Parliament speaker Ghalibaf has since stressed that “diplomacy does not mean surrender and that negotiations are another arena for war”.
• The curve has lightly bull flattened, with  Schatz yields now little changed at 3.209% and  30-year Bund yields down 1.5bps to 3.788%.
• Germany will hold its first auction of the week at 1030BST with E5bln of the 2.90% Oct-31 Bobl. Meanwhile, Italy is launching  a new 12-year BTP Green via syndication.
• The 10-year OAT/Bund spread has underperformed peers this morning, currently up 3.5bps to 104.5bps. PM Lecornu will make an announcement at 1630BST/1730CEST today on the ongoing fuel crisis.
• The remainder of today’s Eurozone calendar includes commentary from ECB President Lagarde and Simkus, with September flash consumer confidence also due.