Lower But Outperforms Most of the G10

NZD/USD prints $0.6130, little changed from levels seen in late NY dealing, down ~0.35% in yesterday's trading.

• US Treasury Yields rose, stocks and commodities fell as Feds Bullard said interest rate should increase to at least 5% to 5.25% warning of further financial stress ahead. S&P500 finished trading down ~0.3%, DXY was up ~0.3%.
• NZD/USD saw a peak to trough fall of 1.7%, from a daily high at $0.6168 late in Asia trading to $0.6065 in the US session. The NZD then pared losses as US Equity markets trimmed losses, and a lower than expected print in Philadelphia Fed Manufacturing Index helped moderate the USD advance.
• Fonterra is divesting its Chilean Soprole business for NZ$1.055bn. “The Fonterra Board intends to make a final decision on the amount and timing of any capital return once the sale agreement is unconditional, cash proceeds are received in New Zealand and having regard to other relevant factors including Fonterra’s debt and earnings outlook at such time”. (per Bloomberg)
• Technically, bulls look to target the 200-day EMA at $0.6240. A break through there would open the way to the high from 12 Aug at $0.6468. Bears need to breach the 100-day EMA at $0.6021 to re-establish the downtrend.
• There is no domestic data out today, participants will look to any COVID developments from China as well as wider swings in risk sentiment to set the tone for NZD.