Forex Today: Kiwi falls further on poor NZ trade, Yellen in spotlight

Moderate risk-aversion persisted in the Asian session, in the wake of an ‘Act of War’ announcement made by North Korea, leaving the safe-haven Japanese yen broadly underpinned alongside gold. Meanwhile, US dollar traded with minor weakness on the back of Fed’s divided outlook on inflation and weaker Treasury yields. Among the higher-yielding currencies, Cable recovered ground and traded with moderate gains, while the Kiwi emerged the biggest loser yet again on dismal trade figures. The Aussie staged a minor comeback on renewed strength in commodities’ prices, although the recovery lacked follow-though amid cautious remarks by RBA’s Bullocks and risk-off moods.

Main topics in Asia

NZ merchandise trade reviewed - Westpac

Analysts at Westpac offered their thoughts on NZ merchandise trade for August 2017.

Reserve Bank Australia's Bullock crossing the wires

Michele Bullock, who is the Assistant Governor for Financial Stability of the Reserve Bank of Australia, has attended a panel and has made comments worth noting in respect to the RBA's monetary policy decision-making. 

Fed's Kashkari speaking at Town Hall In North Dakota

On monetary policy, he explained that he did not vote for a hike for following reasons…

BOJ Minutes: Inflation has stopped declining, QQE and YCC to continue till target met

Bank of Japan [BOJ] minutes of the latest policy meeting shows the board members are optimistic that wage prices will eventually rise and that inflation has stopped declining.

Australia Treasury cash deficit for 2016/17 revised lower

Australia Treasury cash deficit for 2016/17 has been revised lower to $33.2 billion from the previous forecast of $37.6 billion published in May.  

North Korea boosting defence on east coast - Yonhap

Yonhap cited South Korean intelligence agency, via Reuters, as saying that North Korea has been moving airplanes, boosting defence on east coast after recent B-1B dispatch by the US.

Key Focus ahead

Heading into Europe, there is nothing of relevance in terms of macro data for the EUR, GBP traders, except for the second-tier German import prices data. Hence, all eyes remain on the US docket, with the CB consumer confidence and new home sales data slated for release. However, the main risk event for the markets remain the speech by Fed Chair Yellen later tonight.

Yellen is due to deliver a speech titled "Inflation, Uncertainty, and Monetary Policy" at the National Association for Business Economics Annual Meeting, in Cleveland.

EUR/USD defends head and shoulders neckline ahead of Yellen speech

EUR/USD was offered at the confluence of 5-DMA and 10-DMA on Monday after the German elections revealed a sharp rise in support for the far-right AfD party.

GBP/USD: Will it extend the recovery above 1.3500 ahead of Yellen?

The overnight recovery in GBP/USD has come to a stall in the Asian trades, with the bulls now turning cautious amid persisting moderate risk-aversion and a lack of Brexit clarity.

Yellen to speak on 26th September (Inflation, Uncertainty, and Monetary Policy) - Nomura

Recent developments in inflation remain a key focus for the FOMC. 

NZIER sees very slight bias towards tightening

New Zealand Institute of Economic Research (NZIER) shadow board offer some recommendations on the upcoming RBNZ monetary policy due out on Thursday.