SYDNEY, Oct 18 (IFR) - Market Briefs * Fed's Fischer: downshift in potential means "not that simple" to raise rates * Fed 'very close' to employment, inflation goals - Fischer * NY Fed's Empire State business conditions index at lowest since May * Empire misses at -6.8, vs f/c for +1.50 and down from -2.0 in Sept * U.S. Sept industrial output +0.1%, bang in line with forecast Previous month revised down to -0.5% from -0.4% * Sterling trade jumped three times on day of "flash crash" -Thomson Reuters * "Tired of fog? Try the frogs!" Paris tries to poach London business after Brexit-Rtrs * Economists trim Brazil 2016 inflation, rate fcasts ahead of expected c.bank easing * Brazil to ease local content requirements in oil, gas auctions -report * Trump ramps up voter fraud claim, digs in against women accusers-Rtrs Macro Themes in Play * Markets broadly lower, concerned about Rosengren hint at joining ECB and BOJ to steepen yield curve, low long rates priced in to structure of all risk assets, lower oil weighs, S&P closes/consolidates below trend support for third day * Short rates softer after US Industrial Production down YoY for 13th month; Dec rate hike slips small to 2-in-3 from 7-in-10 last week, Nov meeting trades in single digits; Yellen speech Friday not a confidence-booster * USD lower across the board with rates, corrective; Cable still trades long * Oil, CRB toppy; copper approaches major trend support Looking Ahead - Economic Data (GMT) * 21:45 NZ CPI QQ Q3 0.00% f/c 0.40%-prev * 21:45 NZ CPI YY Q3 0.10% f/c 0.40% -prev * 22:30 AU New Motor Vehicle Sales m/m Sep 0.10% -prev Looking Ahead - Events, Other Releases (GMT) * 0030 -- Reserve Bank of Australia will release the minutes of October Monetary Policy Meeting Currency Summaries EUR/USD * Pair sees limited action in NY session and can't benefit much from broad USD weakness * US Empire Mfg data weakens USD & UST yields but EUR/USD can only lift near 1.1010 * Pair's action limited due to combination falling EUR/JPY and USD * Comments by Fed's Fischer have almost no impact * Pair essentially trades 10 pips either side of 1.1000 for NY's session * Daily techs warn bears, RSI diverges on new low & pair closes day green after new low * US Sep CPI and Oct NAHB housing reports are data risks tomorrow USD/JPY * USD/JPY drifted lower after uninspiring US data & Fischer's comments * Rising 200-HMA by 103.75 in close proximity after Fischer * Rising daily Tenkan will also be above 104 on Tues to press bulls' case * US CPI is out Tues to provide more guidance on US rates, nominal & real * 2.3% y/y core CPI v Fed Funds at 37.5bp is ostensibly a very easy policy * JPY generally firmer in a risk-off session: stocks, DM ylds, oil all down * EUR/JPY traded wholly below it's thin Cloud finally: 114-115 key on close * GBP/JPY & AUD/JPY drifted back slightly USD/CHF * USD/CHF uptrend again stalled w highs just beyond 0.99 for 4th straight day * US data & Fed VC Fischer didn't help the USD's cause, nor did yields * USD's recent rise is in need of consolidation & solid US econ data * Rebounding TIPS spreads & slippage in oil starting to loosen longs' grips * EUR/CHF a shade lower & trading wholly below the 1.0895 Cloud base now * Cross looks headed for another run-in with the SNB's 1.08 soft-floor bids * ECB meeting Thur's eye for any QE tweaks: Greek debt talks also in the mix * Swiss Sep M3 & Trade data are also out on Thur GBP/USD * GBP/USD helped out of small loss by mediocre US data, Fischer comments * Brexit planning intrigue never-ended and fractious * Some hope that surge in Gilt ylds is by near-term top as Brexit gap is filled * Talk of "darkest before dawn" GBP trades at some stage * Cable's falling 10-DMA, last at 1.2384, is about to press bears' case * EUR/GBP also consolidating after last wk's spike toward GFC highs * Heavy UK data calendar this week, but traders remain forward-looking * ECB meeting Thur looked to for QE expansion/tapering clues USD/CAD * O/N range 1.3065/3183, Noram range 1.3122/62, close 1.3124 (NY -23 pips) * AUD/CAD up 20 pips in NY at 1.0010, WTI & Brent -0.8% * DXY -0.17% (-0.10% in NY) soft NY Fed mfg data [page:2417] 2Yr spread 21.77 * CAD/JPY was choppy, 78.93/79.31, slipped 0.2% in NY, closed 79.06, -0.29% * S&P -0.28% (-0.1% NY) energy stocks EUR/CAD 1.4438 +0.19% * Gold +0.4%, Cu -0.2%, Al -0.9% Tue- Cda Mfg sales due, US CPI [page:2417] AUD/USD * Bull pressure in Europe's morning carries over to NY session, NY opens near 0.7605 * USD data miss adds to USD's woes and also sends UST yields lower * AUD/USD sees a slow steady climb towards 0.7635, action quiets though * Pair lingers in 0.7620/30 area for remainder of session * RBA minutes a risk in Asia, unlikely to be anything earth-shattering noted NZD/USD * NY opens just above the 200-HMA after Europe adds a bit to Asia's gains * Bull pressure persists in NY after NY Fed Mfg data is well below f/c * USD & UST yields slide, NZD/USD lifts and nears Oct 11 high * Little pullback seen and pair lingers just below the day's high late in the session * NZ Q3 CPI a data risk, RBA minutes might impact via AUD/NZD if any surprises seen LATAM * USD/MXN 18.8525/19.0060 in NY after 18.9575/19.0550 O/N, last 18.8850 * Pair trades heavy after recent widening of Clinton's lead in presidential election polls * Soft oil prices in NY session lifted USD of the lows, WTI & Brent -0.8% * USD/BRL set to end NY by 3.2050 +0.05%, inflation poll sees IPCA lower * USD/CLP ends NY near 'unch' at 670.10, despite copper dip (-0.3%) * Fischer on dificulties of setting monetary policy and GBP could be poor man's CHF one day Sterling bears continue to feast on expectations that Britain is heading for a "hard Brexit". Those bears include investor Jim Rogers, who recently said cable will "certainly go under" 1.00 if Scotland leaves the UK (BBC). Things will certainly look dark for GBP if Britain leaves the EU via a "hard Brexit" and Scotland votes "yes" to independence (Full Story). However, if the darkest hour is just before the dawn, this combination could sow the seeds for a long-run turnaround in sterling's fortunes--notwithstanding Keynes' quote that "in the long run we're all dead". The looser the post-Brexit ties between the UK and the EU, the greater the prospective safe haven allure of GBP if/when there is another euro crisis. Former ECB chief economist Issing recently sounded a warning on another potential euro crisis, saying "one day, the house of cards will collapse" bit.ly/2eGJwfQ & bit.ly/2eHnI3R.