NZD Gives Back Some Of Friday's Outperformance, Steady Trends Elsewhere

Outside of some NZD weakness, G10 markets have started this week in a muted fashion. The BBDXY sits little changed, last near 1241.6. Most EM Asia markets are closed, including China, Hong Kong and Singapore for LNY, while Japan markets are also out.

• Cross asset moves have been quiet as well, US equity futures sit close to flat, while US Tsy futures have drifted a touch higher.
• NZD/USD is close to session lows in recent dealings, last near 0.6130, around 0.3% lower than NY closing levels from Friday. this puts us back sub the 20 and 50-day EMAs, albeit just.
• Comments from RBNZ Governor Orr may have weighed at the margin. He stated that higher inflation is why policy rates are staying restrictive. Orr is appearing before parliament today. He also noted that "we’ll be back at the end of this month again with our updated views on the wisdom of that stance and the length which we have to be there" (per BBG).
• At face value this doesn't suggest a further tightening in rates is being considered, although tomorrow we get inflation expectations and Orr speaks early on Friday morning local time. It seems that if the data warrants it, that policy will stay "restrictive" for longer rather than hiking again at this juncture. In November, the RBNZ projections didn't imply an easing until H1 2025.
• Elsewhere, AUD/USD has been dragged down by NZD, a touch, last near 0.6520, but the AUD/NZD cross has firmed. We were last near 1.0635, but off session highs of 1.0640. Lows from last week came in at 1.0586.
• USD/JPY sits in the 149.20/25 in recent dealings little changed for the session.
• Looking ahead, the Fed’s Bowman, Barkin and Kashkari make appearances, BoE’s Bailey and the ECB’s Lane, Cipollone and Buch speak. In terms of data there are January NY Fed 1-yr inflation expectations and US budget statement. US CPI on Tuesday will be watched closely.