Lockhart says the US has a privileged position as the world reserve currency but it shouldn’t view the privilege as permanent.

He says he doesn’t expect China to say it is satiated and stop buying US Treasuries.

For those fearful that China will stop buying Treasuries (or other dollar-denominated assets, it doesn’t matter what…), get a grip. As long as they buy dollars to weaken the Yuan they will have to invest those dollars somewhere…

Markets are very very quiet. USD/JPY stalled just ahead of 90.40/50 offers and EUR/USD is range trading in a 1.3553/70 range. EUR/JPY resistance lies at 122.60, tested once. We trade now at 122.45.