NZD

• Inflation jolt. Stronger than expected US PPI data pushed US bond yields & the USD higher. US retail sales & FOMC meeting minutes due this week.• AUD struggles. Shaky sentiment & a firmer USD have weighed on the AUD. Since 2015 the AUD has only traded sub $0.65 ~3% of trading days.• Upcoming events. In addition to the US releases, the China data batch, RBNZ meeting, UK CPI, AU wages & AU jobs report are in focus this week. Equity markets remained on the backfoot on Friday as bond yields continued to edge higher following a run of stronger...

Higher yields. The upswing in long-end bond yields has continued. A combination of factors looks to be at play. FX markets were subdued overnight.Data flow. BoE hiked rates by another 25bps, but the tightening phase could be nearing the end. RBA Statement on Monetary Policy released today.US payrolls. US labour market data released tonight. Another solid jobs report could see pricing for another US Fed rate rise lift. The extension of the sell-off in global bonds has been a feature of markets. Long-end rates continue to lead the way with the US 10-year yield up another ~10bps. At ~4.18% the...

• Market wobbles. Higher yields dampened risk appetite. USD stronger. News that Fitch downgraded the US may add to market nerves.• Weaker AUD. Shaky risk sentiment & a paring back of RBA rate hike pricing following yesterday’s on hold decision have weighed on the AUD.• US focus. In addition to any spillovers from the US ratings news, attention will remain on the US over coming days with non-farm payrolls due Friday. The new month has started with a bit of renewed turbulence. Bond yields across Europe and the US rose, led by long-end rates. The US 10yr yield increased ~6bps...

• European growth. EUR lower after Eurozone PMIs underwhelm. The shift in relative yield differentials supported the USD.• China Politburo. The leadership acknowledged the “difficulties”, & while it signaled it may inject fresh stimulus, no concrete measures were unveiled.• AUD events. Australia Q2 CPI due tomorrow, with the US Fed rate announcement & Chair Powell’s press conference on Thursday morning. Mixed performance across markets overnight, with divergence in the US and European business PMI data in focus. The impact of the rapid-fire policy tightening is bubbling to the surface. In Europe, falls in the PMI suggest growth momentum has slowed...