ForexLive Asia-Pacific FX news wrap: US yields and US dollar, both continue to soar | Forexlive

Today’s
Asia session followed the Federal Open Market Committee (FOMC) on
Wednesday in the US where the Fed Funds target was held steady but
the updated dots from the Committee guided higher rates for a longer
period of time. US yields surged, and along with that the US dollar.
Those moves continued here.

USD/JPY
gained further, to above 148.40 and its highest since November last
year. The yield on two-year U.S. Treasury notes rose to a 17-year
high, further widening the gap with Japanese yields and helping drive
the USD/JPY move. The US 10-year yield hit a 16-year high.

We
had some verbal intervention out of Japan, Chief Cabinet Secretary Matsuno said no options would be ruled out. USD/JPY dribbled down to
under 148.30 as I update, i.e. not much.

China
wasn’t spared, with USD/yuan rising. At the reference rate fixing for the onshore yuan, the People’s Bank of China sat heavily, again, on the USD/CNY, with a gap of 1300+ points between the modelled central rate
and the Bank’s setting. The gap was the widest on record as the
Bank seeks to halt the fall of the yuan (successfully, so far, to be
fair).

From
New Zealand today we had Q2 GDP data come in higher than
expectations. In the data was also a revision to Q1 GDP, raised to
zero % change q/q from its prior negative result. This has the
implication that the New Zealand economy didn’t have a
recession after all. Those into archaeology and ancient history take
note.

NZD/USD
fell further on the session after a minor pop on the data. As I post
the rate is on its lows of the session, as is AUD, EUR, GBP, and CAD
against the big dollar. The US dollar index it at its highest since
early March of this year.

As
an aside, for the energy folks, it appears an end is in sight for the
LNG dispute here in Australia between Chevron and Unions. Australia’s
industrial arbitrator says a tentative agreement has been reached and
has given the opposing parties until 9 a.m. Sydney time on Friday to
advise of their acceptance or rejection.

Asian
equity markets … as you’d expect, ugly: