USD Edges Down, AUD & JPY Outperform, NZD Continues to Lag

Outside of NZD, the USD is on the backfoot through the first part of Thursday's session. The BBDXY is back to 1255. AUD and JPY have led gains, both around +0.25% firmer against since the open. Macro news flow has been light, but the softer tone to US cash Tsy yields (-1bps for 3-5yrs), coupled with a better equity market sentiment is likely weighing on the dollar at the margin.

• AUD/USD is back to 0.6725, which is close to recent highs over the past week. Outside of the factors outlined above, improved AU-China relations are likely helping, while commodity prices are also trending in the right direction. Iron ore was last around $112.50/tonne.
• The AUD/NZD cross has continued to trend higher, with NZD lagging. The cross was last just shy of 1.0680. NZD/USD touched a low 0.6285, but is now back to 0.6290/95.
• USD/JPY tracked lower into the Tokyo fix, last under 132.10, around 0.25% firmer in yen terms for the session. The Japan government nudged higher the fiscal 2023 growth forecast to 1.5% (from 1.1% in July), but kept CPI unchanged at 1.7%. Japan investors also continued to sell offshore bonds.
• Risk events remain light for the rest of the session.