Carry trades are expected to come under pressure as the turmoil in the U.S. financial sector continued over the weekend. Lehman Brothers failed to find a buyer, BoA agreed to buy Merrill Lynch and AIG approached the Fed for a $40 bln bridging loan. In a bid to ensure the smooth running of the market the Fed announced new liquidity measures and a consortium of several banks will enhance liquidity with a 70 bln facility. Early European movement is reportedly thin, with participants digesting the implications for the broader market after holiday-thinned Asian trade. There are varying rumours of emergency central bank rate cuts, with talk of 50 bps from the Fed tomorrow and rumours of 25 bp from the ECB also doing the rounds, although this would be in contrast to recent rhetoric from both sets of policy makers. The market bought dollars on a safe haven premise, with the dollar legs suffering on carry trade pressure, with JPY and CHF the main beneficiaries. However, this is a negative dollar story and dollar selle