ForexLive Asia-Pacific FX news wrap: RBNZ leaves cash rate at 5.5%, as expected

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The
focus of the session was on the Reserve Bank of New Zealand monetary
policy decision. The Bank left its cash rate unchanged for the second
meeting in a row, as was almost unanimously expected.
</p><p>While
on central banks, the People’s Bank of China fixing of the USD/CNY
reference rate showed the largest deviation from the expected since
October last year. The rate was set at 7.1986 while the estimate from
Reuters was 800+ points higher at 7.2878. While there was
intervention to sell USD/yuan on Tuesday we have had none so far
today. The PBOC appears to want to slow the pace of the yuan's decline, but
doesn’t seem too bothered by the weakening yuan itself. USD/CNY and USD/CNH
are being supported by widening yield differentials and a more
broadly firmer USD.</p><p>NZD/USD
popped a little after the RBNZ announcement. Elsewhere in major FX
moves were subdued. There was continued volatility in the yuan.
</p><p>Asian
equity markets fell, following the lead from the weakness on Wall Street on Tuesday:</p><ul><li><p>
Japan’s
Nikkei 225 -1%</p></li><li><p>
China’s
Shanghai Composite -0.6%</p></li><li><p>
Hong
Kong’s Hang Seng -1.4%</p></li><li><p>
South
Korea’s KOSPI -1.2%</p></li><li><p>
Australia’s
S&amp;P/ASX 200 -1.4%</p></li></ul><p>USD/CNH:</p>

This article was written by Eamonn Sheridan at www.forexlive.com.