 Swiss Franc and Yen firm up again in Asian session as markets are gradually convinced that a full-blown US-China trade war is underway. Tensions between the two countries have clearly worsened after trade negotiation collapsed weeks ago. And it's clearly not just about trade but a broad range of practices of China, including IP theft. Huawei is highly unlikely to be the only one who will receive broad based sanctions from the US, and more are coming. Additionally, as Treasury Secretary Steven Mnuchin, a relative trade dove, indicated, tariffs on all untaxed Chinese imports are probably just a month away. A full-blown trade war is quickly becoming the baseline scenario. Tariffs impacts are seen again in today's Japan PMI manufacturing, which is back in contraction. Eurozone PMIs and German Ifo might add more pessimistic evidence. Back in the currency markets, Dollar is following as the third strongest one for today on risk aversion. Sterling is the weakest one for today as Brexit crisis in UK deepens with resignation of high profile minister Andrea Leadsom. Australian Dollar is the second weakest so far on anticipation of RBA cut in June. Canadian Dollar got just a very brief lift by retail sales overnight. It's then pulled down by oil price on surprised inventory build. Technically, USD/CAD's quick rebound is inline with our view that it's just extending consolidation from 1.3521. Further rise is expected through this resistance eventually. GBP/JPY resumed recent decline through 139.54 overnight. EUR/JPY and USD/JPY might follow before weekly close, if risk sentiment worsens. Similarly, USD/CHF could break through 1.0050 to resume recent fall soon. AUD/USD, too, looks ready to break through 0.6864 temporary low any time. In Asia, Nikkei is currently down -0.67%. Hong Kong HSI is down -1.30%. China Shanghai SSE is down -0.84%. Singapore Strait Times is down -0.41%. Japan 10-year JGB yield is up 0.0005 at -0.05. Overnight, DOWN dropped -0.39%. S&P 500 dropped -0.28%. NASDAQ dropped -0.45%. 10-year yield dropped -0.033 to 2.393, back below 2.4 handle. | 
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