Risk-On Flows Sap Strength From USD & JPY

The BBDXY almost halved yesterday's advance amid broad-based aversion to the greenback. General risk sentiment improved, with e-mini futures posting gains in a promising sign after U.S. equity benchmarks closed in the red on Wednesday. U.S. Tsy yields were slightly weaker, facilitating the dip in the U.S. dollar.

• Safe-haven currencies fell out of favour. The yen generally outperformed the greenback, but only by a narrow margin. U.S./Japan yield differentials were little changed.
• The Antipodeans benefitted from better sentiment, with the kiwi leading gains after the RBNZ's hawkish monetary policy review yesterday.
• The Aussie dollar was unfazed by an unexpected contraction in Australia's trade surplus, driven by a surprise 4% M/M jump in imports.
• Spot USD/CNH posted a 0.5% drop. Financial markets in mainland China remained closed for a public holiday.
• German factory orders, EZ retail sales and U.S. initial jobless claims take focus on the data front today. There is central bank rhetoric galore, as BoJ, Fed and BoE members will speak, while the ECB will publish the minutes from its September monetary policy meeting.