Elevated US Yields Help Keep Greenback Supported

US yields holding near the highest levels since March 2020 has helped the greenback retain Monday's gains. In the US the Senate announced it will block the government funding bill, plunging the US government into more debt limit theatrics, while Fed's Bostic spoke earlier and said he was not convinced the US would face a period of troublesome inflation. There were reports that North Korea launched another missile into the East Sea though there has been little knock-on effect so far.

• NZD is bottom of the pile so far on Tuesday, while AUD has also lost a handful of pips, as the recent commodity rally pauses.
• JPY is flat, Japan economy minister Nishimura said earlier the government was seeking to lift state of emergency on October 1.
• Offshore yuan is weaker but well within yesterday's range. Goldman Sachs earlier cut its China 2021 GDP forecast to 7.8% from 8.2% while in geopolitics China released two captive US citizens who had been held since 2018.
• Australian retail sales data is due later in the Asia session, before a fairly heavy slate of speakers. These include ECB's Lagarde and MPC's Mann, followed by FOMC Chair Powell and members Evans, Bowman and Bostic.