FED: US TSY 19Y-10M BOND AUCTION: NON-COMP BIDS $99 MLN FROM $13.000 BLN TOTAL

• BOC WORRIED HIGHER GAS PRICES MAY ADD PERSISTENCE TO INFLATION

"*NASDAQ 100 INDEX EXTENDS GAIN 2.5%" - bbg

Equity gains continue ahead of the Trump-Xi meeting later this week, in contrast to more muted moves in Treasuries with TYZ6 for instance being back within a couple of ticks of levels as US desks filtered in. Bessent described weekend meetings with China's Li Chenggang as "very successful" whilst Fox Business reports Bessent will present Trump with a US-China AI pact for Trump to decide on this week.

• Despite the constructive price action for the major equity benchmarks on Monday, the dollar has been trading on a firmer footing, holding close to session highs as we approach the APAC crossover. Indeed, the USD index remains within close proximity to the post Fed highs at 100.56.
• The disconnect to risk potentially highlights a lack of meaningful conviction in the FX space today, and leaves the most recent enthusiasm towards the greenback as the dominant theme following last week’s hawkish Fed meeting.
• The DXY consolidation above both trendline resistance and the pivotal 50-day EMA last week highlights the short-term bullish technical outlook
• USDJPY (+0.3%) is the top performing major pair, reaching as high as 157.53 before fading 20pips to current spot levels. We continue to erode the sharp downswing from last Friday’s potential “rate check” driven move, and on the topside, the focus remains on post-BOJ highs at 158.05 and the 50-day EMA, intersecting at 158.13.
• USDCAD has also risen 0.26% to 1.4025 alongside the broad greenback strength. USDCAD has recently had a solid breach of both its 20- and 50-day EMAs, and eyes its first close above the psychological 1.40 mark since early August.
  • Scope is seen for a climb towards 1.4051, a Fibonacci retracement level, while above here, the focus is on both the Aug 04 and 05 high at 1.4080.
• Separately, AUDUSD (+0.07%) has held a very narrow 0.7111-40 range today as the market awaits comments from RBA Governor Bullock on Tuesday. She is due to participate in a fireside chat about inflation, interest rates, and Australia’s economic outlook.