A$ Outperforms

AUD/USD rebounded into the Asia close late yesterday, moving above 0.6940 and we spent much of the overnight session stuck in a 0.6940/0.6960 range. The A$ outperformed along with some other commodity currencies within the G10 FX bloc. We currently track around 0.6955.

• Cross asset signals were mixed overnight. US equities were weighed by tech underperformance, while the VIX couldn't gain traction above 24%, ending the NY session at 23.36%. The early trend for US futures is lower, following Walmart's earnings warning. This hasn't impacted AUD sentiment a great deal so far though.
• US yields were higher despite further soft survey data (Dallas Fed -22.6). The AU-US 2yr spread remains away from last week's highs spending much of yesterday between -30 to -35bps. AU yields could see some pick up today, although EU yields were more mixed.
• On the commodity front, Bloomberg's aggregate index was higher by 1.33%, while base metals slipped -0.64%. Iron ore edged above $107/tonne, although onshore China steel prices fell late yesterday. Coal prices in Australia (XW1) remained close to recent highs $410/tonne.
• The data calendar is largely quiet today. We do get weekly consumer confidence. The focus largely rests with tomorrow's CPI print though.