Hits Fresh Lows For Week Under 0.5900, As US Yields Rebound

NZD/USD hit fresh lows for this week, just below 0.5900, late in Thursday trade. Post Asia close highs were at 0.5956, but a US yield spike, driven by Fed Chair Powell comments, turned the tide back in the dollar's favor. NZD lost 0.2% for the session, outperforming most of the other majors (except CAD), within the G10.

• NZD/USD is siting very close to its 20-day EMA. A clean break could see recent YTD lows sub 0.5800 targeted. Likely firm resistance will be evident around the 0.6000 region on the topside, with the 100-day EMA also near 0.5990.
• Chair Powell stated the Fed "is committed to achieving a stance of monetary policy that is sufficiently restrictive to bring inflation down to 2% over time; we are not confident that we have achieved such a stance". Our US team noted the comments were very much in line with post FOMC presser.
• Still, US yields finished 10-15bps higher across the curve. 2yr yields are back above 5%. A poor 30yr auction in USTs also contributed to the move.
• Equity sentiment was weaker in US markets, SPX down 0.81%, offsetting earlier EU gains. Commodity indices drifted down a touch.
• Coming up shortly is the October manufacturing PMI, there is no consensus expectation, the prior was 45.3.