NZD Shines On Hawkish RBNZ, USD Recovers From Early Losses

The BBDXY is back above 1285.00, up from earlier lows near 1282.50. U.S Tsy futures are away from earlier highs, although the tone in regional equities has also turned less supportive this afternoon. These moves have aided the USD from a cross-asset standpoint, although overall moves are modest.

• NZD/USD has bucked the firmer USD tone, although the pair is off earlier highs, post the RBNZ. We got above 0.6190, as the central raised rates by 75bps and pushed the terminal rate projection significantly higher. We are now back at 0.6160/65, but the Kiwi is outperforming on crosses.
• AUD/USD is down slightly for the session, last around 0.6640 (-0.15%), weighed by AUD/NZD selling and China headwinds this afternoon, with reports of protests at China's iphone factory weighing at the margin. The AUD/NZD cross touched 1.0750 post the RBNZ, but is now back close to 1.0780.
• USD/JPY is back near 141.50, with an early session dip sub 141.00 supported. EUR/USD is outperforming modestly, holding close to 1.0315, slightly up for the session.
• Coming up, flash Eurozone PMIs will be in the spotlight before US durable goods, new home sales and UMich sentiment data. The FOMC minutes caps off the Wednesday docket. Sell-side analysts mostly see risks to the minutes as leaning hawkish, at the very least cementing expectations for an upgrade to the median 2023 dot in December's next SEP vs September's editions.