Themes

· General mood is “risk off”

· Fed’s Daly and Evans: 50bp hike needed at the next Fed meeting

· USD catches an offer as profit takers move in to trim recent strong gains

What’s Moving

Like a stretched elastic band, the Dollar fell back overnight, with profit taking after recent gains vocalized as the main flow. While there were some individual stories on the day, the broader bias was simply Dollar profit taking.

The CAD caught an extended bid on higher-than-expected Canadian CPI. While both Fed’s Evans and Daly continued to talk up the need for a 50bp rate hike at the next Fed meeting.

Thoughts

Early trade this morning has seen the NZD hit hard after a softer than expected NZ Inflation number (6.9% from 7.1% talk. This has seen sales in the NZD against the USD and the AUD.

There is no other data slated for release in Asia today. Expect position adjustment to dominate local flows