Risky assets continue to come under heavy selling pressure. During today's Asian Session, the pressure was bought on largely by the EURUSD sinking down to 1.2234, from Friday's 1.2672. While no single news event triggered the selloff in risky assets, the increased tension between North and South Korea sure didn't help investor confidence. Asian stock indices are considerably lower with the Hang Seng down 3.41%. In the Eurozone, weekend news and events continue to wreak havoc on the EURUSD. The Spanish government announced it would take over CajaSur, one of Spain's largest savings banks, and additional consolidate another 3 regional banks. In addition, the IMF stated that Spain required significant structural reforms and acutely identified Spain's problems of a dysfunctional labor market, a deflating property bubble, a large fiscal deficit, heavy private sector and external indebtedness, anemic productivity growth, weak competitiveness and a banking sector spotted with pockets of weakness. Look for EURUSD weakness to continue. Onto GBPUSD, the 2nd estimate of UK Q1 GDP will be released today and the market is expecting a revision to +0.3% from +0.2%. Any positive adjustment will be good news for the GBP and for policy-makers. On the intellectual circuit, comments from MPC Posen alluding the current UK environment to early-90s Japan were a bit forbidding. However, what is encouraging is that Posen stated that the UK would learn from Japan's policy errors and not precipitate a lost decade by tightening prematurely. The combined worry across various markets has pushed LIBOR USD funding costs to rise about 50 basis points for the first time in 11 months. We don't expect this trend to reverse in the near term and risk-correlated currencies should continue to lose relative value in the near-term. Something to take note of is that markets seem keen on reacting violently to poor news while remaining quite muted to any positive headlines. In the coming days, we'll continue to watching market reactions to headlines in order to assess risk sentiment and confidence.