AUD/NZD Dips Amid Broken Barrier Chatter, Loonie Lags G10 Pack

AUD/NZD plunged to its lowest point since Apr 2020 amid talk of broken barrier option at NZ$1.0400, with BBG trader source pointing to poor liquidity in the NZD leg. The Kiwi dollar remained comfortably the best G10 performer and modest improvement in the local Covid-19 situation may have helped it cling onto the bulk of gains registered on the back of the aforementioned downswing in AUD/NZD. New Zealand reported 49 new cases today, the lowest number in six days and all of them in Auckland. The alert level in all areas south of Aotearoa's largest city will be moved down a notch at midnight today.

• Other commodity-tied currencies traded on a softer footing as crude oil cheapened. The loonie suffered the largest loss amid uncertainty surrounding the outcome of PM Trudeau's political gambit, with the Premier set to fight an uphill re-election battle after calling a snap poll.
• Spot USD/CNH crept higher before giving away most gains. The rate showed a muted reaction to a miss in China's official Non-M'fing PMI, which unexpectedly flipped into contraction.
• The greenback struggled for any momentum and the DXY printed its worst levels in two weeks while testing its 50-DMA.
• London trading reopens after a UK bank holiday, with U.S. MNI Chicago PMI & consumer confidence, German unemployment and EZ CPI set to take focus on the data front today. Central bank speaker slate includes ECB's Holzmann, Knot & Lane as well as Riksbank's Floden.