NZD

• Mixed signals. US CPI matched forecasts boosting expectations for a Fed cut next week. US equities rose but so did bond yields. USD firm.• Policy trends. BoC cut by 50bps. But flagged a more measured pace. ECB expected to cut again tonight. Shifting yield spreads remain USD supportive.• AUD impulses. AUD whipped around by newsflow. AU jobs data released today. Short-term AUD reaction to data likely to be binary. It was a busy night in terms of newsflow, however, outside of a jump up in US equities most other markets were well contained with the odd burst of volatility...

• RBA rhetoric. Changes by the RBA to its guidance weighed on AUD. NZD has gone along for the ride. Odds of a February RBA cut have risen.• Data driven. Data will drive the RBA’s decision. Jobs report released tomorrow. Quarterly CPI out in late-January.• Global macro. Bank of Canada expected to cut rates again tonight. US CPI also due. Sticky core inflation could give the USD more support. Offshore market moves were fairly constrained overnight as participants await the latest read on US inflation (due tonight at 12:30am AEDT). European and US equities dipped with the S&P500 (-0.3%) holding...

• China bounce. Policymakers in China changed their tone when it comes to policy. Prospect of more stimulus supported assets like the AUD.• RBA focus. No rate change expected from RBA. Will it alter its guidance? A tweak could see the AUD lose some ground.• Event radar. RBA today. Later this week, ECB & BoC meet. US CPI inflation also due, & the China CEWC will be held. A bit of a reversal of fortunes across markets at the start of the new week with moves that flowed in the wake of Friday nights US jobs data reversing. The catalyst...