Kiwi Sinks On Labour Market Data, Greenback Gains On Fed Comments

Greenback strength has carried over into Asia after Fed members reaffirmed their commitment to defending the inflation target, pushing back against the recent moderation in hawkish rate hike bets. Speaking in the NY/Tokyo crossover, FOMC's '22 voter Bullard noted that a soft landing for the economy "doesn't require gradualism."

• The BBDXY Index has crept higher after its bounce from the ascending 50-DMA on Tuesday, even as U.S. Tsy yields sit a touch lower in cash Tokyo trade. The U.S. dollar outperforms in G10 FX space.
• The yen has fallen prey to fresh rounds of hawkish Fedspeak, owing to its sensitivity to relative interest rate dynamics. USD/JPY has added ~60 pips so far, completing a swing into a week-to-date gain.
• The kiwi sank after the release of New Zealand's Q2 labour market report, which showed that the unemployment rate unexpectedly ticked higher from record lows, while employment growth and participation also disappointed. Still, it should be noted that wage data beat forecasts.
• The Antipodeans sit at the bottom of the G10 pile as participants have parsed NZ jobs data, while U.S. e-mini futures are headed lower. AUD/USD has slid through the $0.6900 mark, while AUD/NZD has recouped yesterday's losses.
• Cross-strait tensions remain front and centre in Asia as U.S. House Speaker Pelosi continues her visit to Taiwan, while Beijing keeps rattling its diplomatic/military/trade sabres.
• Today's data highlights include U.S. factory orders & final durable goods orders, EZ retail sales and a suite of Services PMI readings from across the globe.
• Central bank speaker slate is dominated by Fed members, with Bullard, Harker, Daly, Barkin & Kashkari all set to make appearances.