USD Higher As Weaker China PMIs Hit Equity/Commodity Sentiment, NZD/USD Tests Sub 0.6000

The USD is higher across the board, with the BBDXY last near 1247.20, around 0.20% firmer versus NY closing levels from Tuesday. Recent highs in the index rest between 1248.50-75. China matters have dominated the Asia Pac session, with weaker official PMI prints weighing on broader risk appetite and boosting the USD.

• NZD/USD has been the weakest performer, falling nearly 0.70% and briefly dipping sub 0.6000. ANZ activity and business confidence figures suggested the economy likely troughed in H1, but inflation pressures continued to ease.
• NZD was weighed by softer commodity prices, weaker equity sentiment, as was the AUD. AUD/USD has fallen through 0.6500, last at 0.6495, very close to recent lows. Iron ore is back $97/ton, while CMX copper has lost 0.8% so far today. The weaker China PMIs clouding the demand outlook.
• AU Apr CPI was firmer than expected, and Goldman's is now forecasting RBA hikes in June and July, but this hasn't provided much offset for AUD/USD (AUD/NZD is higher though, last near 1.0820).
• USD/JPY is slightly higher, the pair last at 139.85, although the yen has outperformed in the G10 space on heightened risk aversion. Japan Apr activity data was weaker than expected, while BoJ Governor Ueda gave a wide ranging speech, but nothing that shifted the policy needle.
• Later the Fed publishes its Beige Book and Collins, Bowman, Harker and Jefferson all speak. In terms of data, there are the May Chicago PMI and April JOLTS job openings released. The EU Financial Stability Review is due and ECB President Lagarde will speak.