The kiwi took flight after RBNZ Gov Orr.......>

FOREX: The kiwi took flight after RBNZ Gov Orr stated that the MPC can afford to

"wait, watch and observe what's happening" and will "assess the situation in

Nov," which encouraged investors to pare bets that the RBNZ will ease policy at

the next meeting. These remarks overshadowed Orr's pledge to do "whatever it

takes" to support NZ economy and to trim the OCR if needed.

- Broader improvement in risk environment helped NZD hold onto gains & aided

AUD, but pressured safe haven FX. A light JPY sell-off into the Tokyo fix

cemented the yen's underperformance. Meanwhile, Japanese CPI numbers indicated

that price growth remains sluggish, with core CPI meeting MNI exp. at +0.6% Y/Y.

- USD/CNH showed above CNH7.1 as today's USD/CNY mid-point was set at the

highest level since Mar '08, although slightly lower than exp. Yuan weakness

spilled over into the won, which had already struggled on the back of escalating

S. Korea-Japan tensions, as well as familiar security & economic concerns.

- Focus turns to U.S. new home sales & Canadian retail sales. It goes without

saying that any fallout from the Jackson Hole symposium will be closely watched,

with Fed Chair Powell & BoE Gov Carney due to speak later today.