USD Higher Amid Yield Rise, NZD Hits Fresh Lows Post Weaker Sentiment Results

The USD index sits at 1244.7, up modestly for the session, albeit sub earlier highs (1245.34). US yields sit higher following an earlier speech from the Fed's Waller. We are 1 to 3.5bps higher in yield terms, led by the front end (2yr back to 4.60% handle).

• Waller stated the Fed's easing cycle can begin later and in smaller steps and that there is no reason to have big cuts in the policy rate.
• Yen isn't showing as much sensitivity to US yield moves. USD/JPY is slightly higher at 151.35/40, but is outperforming the rest of the G10. Intervention risks may be curbing enthusiasm for fresh upside in the pair. The BoJ Summary Of Opinions from the March meeting were broadly in line with recent BoJ rhetoric.
• NZD/USD hit fresh YTD lows of 0.5980, we now sit slightly higher near 0.5990. Outside of the US yield move we have seen sharp drops in both business and consumer confidence prints in NZ. The next target for NZD is Nov 17 lows from last year at 0.5941.
• AUD/USD is also lower, albeit outperforming NZD modestly. We were last around 0.6525. A slightly softer round of data printed a little while ago, with retail sales at 0.3%, versus 0.4% forecast. Job vacancies fell sharply (-6.1% q/q). We also had a further slowing in consumer inflation expectations to 4.3% from 4.5%.
• The data calendar is largely empty for the rest of the session, but focus will be on the CNY fixing and onshore spot open, as well as the regional equity tone.