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Dollar Higher, A$ & NZD Hit Fresh YTD Lows Amid Regional Equity Weakness

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The BBDXY remains on the front foot, up a further 0.20% in the first part of Tuesday trade. Thie index last near 1264.3, is eyeing highs near 1266, levels last seen in mid Nov last week.

  • Sharp falls in regional equities have likely aided USD sentiment. A number of key regional markets have fallen more than 2%. Higher US yields has weighed particularly on tech related sentiment. Cash tsy yields are a touch higher for US benchmarks, despite the risk averse tone emanating from equities.
  • The USD/CNY fix also moved back above 7.1000, which kicked off a fresh round of USD gains, although USD/CNH has stabilized.
  • China Q1 GDP was better than expected, but March activity figures point to loss momentum towards the end of the quarter, with IP and retail sales both notably sub expectations. Property related indicators also continued to show sharp double digit falls for the most part.
  • AUD and NZD sit slightly above earlier fresh YTD lows, but both remain weaker by around 0.40%. AUD/USD got to 0.6408, but sits higher at 0.6415/20 in latest dealings. Regional equity risk aversion is weighing. A clean break sub 0.6400 opens up 0.6339, November 10 low.
  • NZD/USD remains in a downward trend trading well below the 20, 50, 100 & 200-day EMA with the pair is trading back below 0.5900 at 0.5878 making new YTD lows and now looking to test 0.5864 (Nov 11 lows).
  • The yen has outperformed, last near 154.30 in USD/JPY terms. We have had the familiar run of FX rhetoric/jaw boning, while the weaker equity backdrop has likely aided yen at the margins.
  • Looking ahead, the Fed’s Powell (1815 BST), Jefferson, Williams, Barkin and Collins appear, as well as BoE’s Bailey and BoC’s Macklem. There are also US March housing starts/permits, IP & April NY Fed services, UK labour market and Canadian March CPI data. The IMF is due to publish the April World Economic Outlook.
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The BBDXY remains on the front foot, up a further 0.20% in the first part of Tuesday trade. Thie index last near 1264.3, is eyeing highs near 1266, levels last seen in mid Nov last week.

  • Sharp falls in regional equities have likely aided USD sentiment. A number of key regional markets have fallen more than 2%. Higher US yields has weighed particularly on tech related sentiment. Cash tsy yields are a touch higher for US benchmarks, despite the risk averse tone emanating from equities.
  • The USD/CNY fix also moved back above 7.1000, which kicked off a fresh round of USD gains, although USD/CNH has stabilized.
  • China Q1 GDP was better than expected, but March activity figures point to loss momentum towards the end of the quarter, with IP and retail sales both notably sub expectations. Property related indicators also continued to show sharp double digit falls for the most part.
  • AUD and NZD sit slightly above earlier fresh YTD lows, but both remain weaker by around 0.40%. AUD/USD got to 0.6408, but sits higher at 0.6415/20 in latest dealings. Regional equity risk aversion is weighing. A clean break sub 0.6400 opens up 0.6339, November 10 low.
  • NZD/USD remains in a downward trend trading well below the 20, 50, 100 & 200-day EMA with the pair is trading back below 0.5900 at 0.5878 making new YTD lows and now looking to test 0.5864 (Nov 11 lows).
  • The yen has outperformed, last near 154.30 in USD/JPY terms. We have had the familiar run of FX rhetoric/jaw boning, while the weaker equity backdrop has likely aided yen at the margins.
  • Looking ahead, the Fed’s Powell (1815 BST), Jefferson, Williams, Barkin and Collins appear, as well as BoE’s Bailey and BoC’s Macklem. There are also US March housing starts/permits, IP & April NY Fed services, UK labour market and Canadian March CPI data. The IMF is due to publish the April World Economic Outlook.