Antipodeans Dominate

AUD and NZD FX flows have dominated today, following key event risks in both economies.

• AUD/USD dipped sub 0.6990, following the weaker than expected Q2 wages print, which came in at 0.7% versus 0.8% expected. Annual growth was also weaker than expected at 2.6%YoY, but in line with the recent RBA forecast projection. AU rates dipped on the data print, but there wasn't a great deal of follow through. The 2yr bond yield is back to levels that prevailed prior to the data release (2.77%).
• Helping these moves was a hawkish 50bps RBNZ hike, the central raised their OCR peak to above 4%, while also noting a larger increase was considered at the meeting. NZD/USD spiked higher, gaining above 0.6380 before selling interest emerged. We dipped back below 0.6340 during RBNZ Governor Orr's press conference as he stated the central bank didn't get close to a 75bps hike announcement today. NZD/USD is now back at 0.6350.
• AUD/NZD initially dipped sub 1.1000, touching a low of 1.0990 before support kicked in. We are back around 1.1030/35 now. Note the 100 day MA comes in at 1.1014 for the cross.
• Tight ranges have prevailed elsewhere, with EUR/USD not getting much beyond a 1.0165/1.0180 range. USD/JPY has had a wider range, with a brief dip below 134.00 supported. We are now back at 134.15. US equity futures have been quiet, not too far away from flat for most of the session, while US yields have been relatively steady as well.
• Coming up, focus will turn to UK inflation data, flash EZ GDP and U.S. retail sales. Comments are also due from the Fed's Bowman. Elsewhere, the FOMC will release the minutes from its most recent monetary policy meeting.