USD Outperformance Extends Into Asia

The U.S. dollar takes lead in G10 FX space after the Asia-Pacific woke up to the latest FOMC monetary policy decision. Policymakers raised interest rates by 75bp and charted a steeper tightening outlook, while Fed Chair Powell reaffirmed resolve to contain inflation and warned that "the chances of a soft landing are likely to diminish."

• U.S. Tsy curve has bear flattened in early Tokyo trade, with yields last seen 0.8-3.1bp cheaper, while weakness in e-mini futures suggests the post-Fed pain for equity space may not be over. The BBDXYY index has crept higher, printing fresh all-time highs at 1,327.
• Spot USD/KRW broke above KRW1,400 for the first time since 2009, inviting a fresh round of verbal interventions from South Korean officials.
• The yen showed some weakness in early dealing but has now found poise, as risk aversion allows it to outperform all G10 peers save for the greenback., Selling pressure hit the Antipodeans, with regional liquidity sapped by an Australian market closure.
• USD/JPY overnight implied volatility sits well below yesterday's three-month high but remains relatively elevated ahead of the upcoming BoJ monetary policy decision.
• A marathon of central bank meetings takes centre stage today, with BoJ policy review set to steal the limelight in Asia. Data highlights include U.S. current account balance & jobless claims, while central bank speaker slate features ECB's Schnabel, BoE's Tenreyro, as well as Riksbank's Floden & Ohlsson.