NZD Firms On Solid CPI Details, USD Modestly Down Elsewhere

USD sentiment is softer in the first part of Wednesday Asia Pac trade. the BBDXY is back under 1266, as NZD leads G10 gains post firmer details on the Q1 CPI print.

• NZD/USD initially sunk to 0.5861 on headlines that CPI was weaker than forecast. However, we quickly rebounded as these were corrected by the news wires.
• Headline CPI was in line with the Bloomberg consensus at 4.0% y/y (although was above the RBNZ forecast, but non-tradables inflation was stronger than forecast indicating continued sticky domestic inflation pressures. We get RBNZ measures of core inflation later on today.
• NZD/USD currently tracks close to session highs around the 0.5895/00 level (+0.25% firmer). AUD/USD has rallied as well, last up 0.25%, to be back in the 0.6410/15 range. Early equity sentiment is a touch firmer, with US futures up nearly 0.20%. US yields are mixed in the first part of trade, but overall moves are less than 1bps.
• USD/JPY sits modestly lower, last near 154.60. Earlier March trade data was close to expectations, with export growth at 7.3% y/y (forecast was 7.0%). The adjusted trade deficit was slightly wider than forecast at -¥701.5bn.
• Coming up later the focus will be on the USD/CNY fix. Yesterday's above 7.1000 outcome drove a fresh round of USD buying.
• Otherwise the event calendar is fairly light for the remainder of the session.