OIL: Crude Stocks Fall As Products Build

The early G10 tone is USD positive against the majors, albeit still in light liquidity conditions before all Asian markets get underway. There is focus on earlier news stories from US-China officials citing 'substantial progress' made from weekend trade talks held in Switzerland. 

• AUD, NZD and CAD are all outperforming, although gains against the USD are modest at this stage and more prominent against the likes of yen. USD/JPY was last above 146.00, last near 146.20 (up nearly 0.60% from end Friday levels in NY).
• USD/CHF is tracking near 0.8350, up +0.40%. Both pairs are around multi week highs. EUR/USD was down to 1.1210/15 in latest dealings off 0.30%.
• AUD/USD was up a touch to 0.6420/25, NZD/USD near 0.5925, around 0.25% firmer.
• USD/CNH is down to 7.2250/55, around 0.20% stronger for the session so far in CNH terms. This pair remains within recent ranges though.
• Focus is now on details from the trade talks, with Reuters quoting US Trade Representative Greer that an agreement has been reached to lower the trade deficit. More details are expected from the US side on Monday, while Rtrs also noted China officials were expected to brief reporters Sunday evening Geneva time (although it is getting closer to midnight). A joint statement was also expected to be released per newswire reports. 

Headlines have crossed from both the US and China sides on 'substantial progress' made in terms of trade talks held over the weekend in Switzerland. 

BBG notes: "The US and China both reported “substantial progress” after two days of talks in Switzerland aimed at de-escalating a trade war, marking what Chinese Vice Premier He Lifeng called “an important first step” toward resolving differences."  "While neither side immediately announced specific measures on Sunday, He said the world’s two biggest economies agreed to create a mechanism for further talks, led by US Treasury Secretary Scott Bessent and himself. Bessent said the US would share details on Monday and He promised a joint statement." see this link for more details. 

Reuters stated: "U.S. Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer said on Sunday they reached a deal with China to cut the U.S. trade deficit, describing "substantial progress" in high-stakes talks with Chinese officials but offering no details as two days of negotiations concluded in Geneva." See this link.  

• The market now awaits more details. Rrts noted that China officials were expected to talk to reporters later on Sunday evening Switzerland time.