Greenback Sags, Gives Way To Antipodeans

The greenback lost attitude in the lead-up to the Jackson Hole symposium, with the BBDXY index grinding through yesterday's trough amid generally softer U.S. Tsy yields. Headline flow contained little in the way of notable catalysts.

• USD/JPY went offered over the Tokyo fix before stabilising ~30 pips below neutral levels. Its downswing was correlated with a decline in broader greenback strength.
• The Antipodeans turned bid as a move higher in e-mini futures testified to an improvement in risk sentiment. Some suggested that a new CNY1tn stimulus package announced by China's State Council generated demand for offshore yuan as well as AUD and NZD.
• The kiwi dollar knee-jerked lower after data showed a surprise contraction in New Zealand's retail sales. While the initial move was quickly unwound, the weak outturn may have underpinned demand for AUD/NZD, which printed a new one-month high.
• USD/KRW was trending lower as the BoK delivered the expected 25bp rate hike, while Gov Rhee said at a press conference that the central bank is monitoring the impact of the FX rate on domestic economy.
• German GDP & Ifo survey, U.S. GDP & jobless claims as well as the minutes from the ECB's July monetary policy meeting take focus from here.