• New Zealand central bank unexpectedly votes 4-3 to hold, sending kiwi dollar plunging as much as 1.7%

• US dollar in holding pattern ahead of pivotal Federal Reserve meeting, BoC decision also due

• Israeli shekel sinks as exit polls signal political deadlock after election

(Adds RBNZ commentary, Bank of Canada, Israeli shekel; updates markets through Asia afternoon)

By Gregor Stuart Hunter

SINGAPORE, Oct 28 (Reuters) - The US dollar held onto gains on Wednesday after rallying to a two-week high ahead of policy decisions from central banks including the Federal Reserve, though the kiwi dollar plunged after the country's central bank unexpectedly kept rates on hold.

Most of the dollar's peers were unmoved ahead of the Fed decision. The euro was flat at $1.1124, while the British pound slipped 0.1% to $1.32945. Against the yen , the dollar moved between gains and losses and was last flat at 157.945 yen.

The New Zealand dollar sank as much as 1.7% to an intraday low of $0.55831 after the Reserve Bank of New Zealand unexpectedly held interest rates at 2.75%. A Reuters poll said 22 of 27 economists expected the central bank to raise rates.

"The market just got that wrong," said Mike Houlahan, director at Electus Financial in Auckland.

"The election is only 10 days away," he added. "It's common courtesy not to get involved in politics."

The currency trimmed some losses after Governor Anna Breman said the central bank's rate-setting committee expected to see further official cash rate increases in coming meetings. She also said, "They may even be higher than we said at the September meeting."

"It looks like the RBNZ has delayed tightening rather than cancelled it outright and they'll probably resume before long," said Thomas Mathews, head of markets for Asia-Pacific at Capital Economics in Wellington. "That said, given the economic backdrop, it always seemed as though market pricing was a bit too aggressive. I wouldn't be surprised if we get more dovish 'surprises' over time and more kiwi weakness."

The Australian dollar was 0.1% stronger at $0.70345 after the release of inflation data, which stood at 1.3% in the third quarter of the year, up from 0.6% in the previous quarter. The trimmed mean measure of core inflation was 1%, matching market estimates and keeping the annualised rate at an above-target 3.6%.

The Reserve Bank of Australia will debate whether four interest rate hikes this year will prove sufficient to return inflation to its target at a policy meeting next week, Governor Michele Bullock told lawmakers on Wednesday.

"Today’s inflation data and Senate testimony are the final pieces of information before the RBA Monetary Policy Board (MPB) meets next week," Westpac analysts wrote. "Recent data and communication have consistently pointed to the staff recommending an increase in the cash rate," they added.

"We expect a majority of the external members to agree, though some members might dissent."

In the US, traders broadly expect no change in central bank policy. Fed funds futures are pricing an implied 91% probability that the Federal Open Market Committee will keep its policy interest rate on hold, the CME Group's FedWatch tool showed.

"The Fed doesn't need to hike today to move markets," said Chris Weston, head of research at Pepperstone Group in Melbourne. "It simply needs to change the perceived probability of hiking in December."

The US dollar index , which measures the greenback's strength against a basket of six currencies, was flat at 102.40, trading around its highest level since October 14. The yield on the US 10-year Treasury bond was up 2.2 basis points at 5.0112%.

Against the Canadian dollar , the US dollar was up 0.1% at C$1.4063 ahead of an interest rate decision from the Bank of Canada. The central bank will likely raise its benchmark interest rate as a pre-emptive move to stop energy-led inflation from spreading into the rest of the economy, according to money market data implying a 77% chance of a 25-basis-point increase. Economists surveyed by Reuters were more sceptical, with 19 out of 34 polled expecting a hike.

The Israeli shekel also weakened 1% on renewed political uncertainty as exit polls pointed to deadlock after the country's elections.

In cryptocurrencies, bitcoin was 0.4% higher at $81,062.47, while ether climbed 0.8% to $2,360.81.

(Reporting by Gregor Stuart Hunter; Editing by Christopher Cushing, Jacqueline Wong and Thomas Derpinghaus)

• USD/JPY remained bid in Asia, 157.80-158.03 EBS, in 156.23-158.44 Ichi cloud

• Market on tenterhooks ahead of FOMC policy announcement, hawkish hold eyed

• Moves in US yields, market reaction to FOMC to be eyed closely

• Case of buy-the-rumour, sell-the-fact? Plenty of uncertainties

• Further USD/JPY resistance at 158.54 200-DMA, 159.27 100-DMA

• Hourly Ichimoku tenkan 157.91, kijun 157.79, 200-HMA 157.70, cloud 157.04-38

• Option expiries today include 157.00/50 $1.9 bln, 157.75-85 $3.2 bln

• Also $1.5 bln at 158.00 strike and $1.4 bln between 158.25-30

• Large to massive option expiries today to help contain FX action into FOMC?

• JPY crosses mostly in stasis for now awaiting fresh flows

• EUR/JPY 175.57-84 EBS, holding above 175.19 low Friday, lowest since Oct '25

• Back below 175.80-176.06 hourly Ichimoku cloud

• CHF/JPY 190.15-65, 190.58 100-HMA cap? Below 191.58-194.53 daily Ichi cloud

• GBP/JPY 209.86-210.27, below 210.71-213.31 daily cloud, near 210.06 100-HMA

• AUD/JPY bid on hawkish RBA-speak, 110.84-111.34, below 111.71-112.09 cloud

• NZD/JPY 89.85 to 88.13 before steadying, against expectations, RBNZ holds

• RBNZ maintained its hawkish bias but did not hike as generally expected

• Related comments , , , also
USD/JPY hourly:


AUD/JPY hourly:


NZD/JPY hourly:

(Haruya Ida is a Reuters market analyst. The views expressed are his own)

(Adds RBNZ decision and moves in kiwi dollar)

By Gregor Stuart Hunter

SINGAPORE, Oct 28 (Reuters) - The US dollar held at a two-week high on Wednesday ahead of policy decisions from central banks, with the Federal Reserve widely expected to leave its policy interest rate unchanged while signalling the probability of any December move.

Most of the dollar's peers were unmoved ahead of the Fed decision. The euro was flat at $1.1129, as was the British pound at $1.3307. Against the yen , the dollar oscillated between gain and loss and was last 0.1% weaker at 157.81 yen.

The kiwi dollar sank as much as 1.7% to $0.5585 after the Reserve Bank of New Zealand unexpectedly held interest rates at 2.75%. A Reuters poll had 22 of 27 economists forecasting the central bank would raise rates.

"The market just got that wrong," said Mike Houlahan, director at Electus Financial Ltd in Auckland. "The election is only 10 days away," he added. "It's common courtesy not to get involved in politics."

The Australian dollar was 0.1% stronger at $0.7035 after the release of inflation data, which was 1.3% in the third quarter of the year, after 0.6% the previous quarter. The trimmed mean measure of core inflation was 1%, matching market estimates and keeping the annualised rate at an above-target 3.6%.

The Reserve Bank of Australia will debate whether four interest rate hikes this year will prove sufficient to return inflation to target at a policy meeting next week, Governor Michele Bullock told lawmakers on Wednesday.

In the US, traders broadly expect no change in central bank policy. Fed funds futures are pricing an implied 91% probability the Federal Open Market Committee will keep its policy interest rate on hold, the CME Group's FedWatch tool showed.

"The Fed doesn't need to hike today to move markets," said Chris Weston, head of research at Pepperstone Group in Melbourne. "It simply needs to change the perceived probability of hiking in December."

The US dollar index , which measures the greenback's strength against six currencies, rose 0.3% on Tuesday to 102.40, its highest since October 14. The yield on the US 10-year Treasury bond was unchanged at 4.9967%.

In cryptocurrencies, bitcoin was flat at $80,736.07, while ether nudged up 0.1% to $2,345.25.

(Reporting by Gregor Stuart Hunter; Editing by Christopher Cushing and Jacqueline Wong)

• NZD/USD -1.2% Wed after RBNZ unexpectedly leaves OCR on hold at 2.75%

• With a rate hike widely anticipated NZD under immediate selling pressure

• Break below 0.5636 21-DMA a very bearish signal, 0.5566 the next target

• RBNZ vote split 4-3 (hold versus hike), says further OCR increases likely

• FOMC outcome and associated dialogue due later Wed, will be closely watched

• Brent crude +0.5% in Asia to $114.40 a barrel as Middle East talks continue

• Overnight USD index gains & firmer UST yields weighed on NZD pre-RBNZ

• Range NZ 0.55831-0.5687, support 0.5566 0.5485, resistance 0.5995 0.6012
NZD Daily 21/55/100-DMA

(James Connell is a Reuters market analyst. The views expressed are his own.)

• AUD/USD +0.3% Wed after AU Sep quarter CPI prints above expectations

• AU Q3 CPI +1.3% q/q, +3.9% y/y (poll consensus: +1.2%, +3.9% respectively)

• RBA Governor Bullock says domestic capacity pressures fuelling inflation

• Futures pricing now implies 84% probability of Nov 3 RBA hike

• Contingent of RBA officials (including Bullock) before senate committee Wed

• FOMC widely expected to hold FFR steady Wed, dialogue will be critical

• WTI +0.5% in Asia to $100.42 a barrel as Middle East talks continue

• AUD sellers ahead of 0.7055 200-DMA will slow topside extension short-term

• Range Asia 0.7026-55 support 0.6865 0.6834, resistance 0.7053 0.7282
AUD Hourly Bollinger Study & DXY Daily 55/100/200-DMA

(James Connell is a Reuters market analyst. The views expressed are his own.)

• USD/JPY from around 157.00 back to @158.00 into FOMC, hawkish expectations

• Though Fed on hold tonight, most see December hike

• USD broadly bid on back of this view, also on Wall St gains, Anthropic IPO

• USD/JPY 157.84-158.03 EBS so far in Asia, in 156.23-158.44 daily Ichi cloud

• Base of cloud rising gradually, top sideways, to eventually fall off sharply

• Move above hourly Ichi tenkan at 157.93 sustainable? Exporter offers 158.00+

• Support from 157.73 hourly kijun, then 157.70 200-HMA, cloud/100-HMA below

• Massive option expiries in area today, between 158.00-50 above $3.8 bln

• Below from 157.90 down to 157.00 total $3.8 bln too

• These option expiries likely to help contain spot into FOMC announcement

• JGB-US Treasury rate differentials in stasis below recent wides

• Related comments , , , also

• US markets , , ,
USD/JPY daily:


USD/JPY hourly:


USD/JPY nearby option expiries this week:

(Haruya Ida is a Reuters market analyst. The views expressed are his own)

• NZD/USD -0.5% from Tue 0.5707 high as USD index gains 0.4% & UST yields firm

• RBNZ monetary policy meeting outcome due Wed, 25 bps hike widely anticipated

• NZD near lower hourly Bollinger band, downside extension unlikely pre-RBNZ

• FOMC outcome and associated dialogue due later Wed, will be closely watched

• Brent crude -1.4% as Middle East talks temper supply fears for time being

• Range NZ 0.5681-87, support 0.5566 0.5485, resistance 0.5995 0.6012
NZD Hourly Bollinger Study & DXY Daily 55/100/200-DMA

(James Connell is a Reuters market analyst. The views expressed are his own.)

MUFG Research previews tonight's October RBNZ meeting.

"First up in the schedule of G10 central bank announcements this week is the RBNZ which will announce later tonight, and the rates market is nearly fully priced for a 25bp hike. NZD is the third best performing G10 currency this month and a hawkish hike is what is required for that currency performance to continue – three rate hikes in total are priced by March so strong guidance supporting that pricing is required," MUFG notes.

"We expect the RBNZ to deliver tonight but ultimately under-deliver what is priced. We expect only one further hike to 3.25% – the market pricing implies 3.5 additional hikes after tonight’s. Q3 inflation was a little weaker than expected and that likely highlights the level of spare capacity in the New Zealand economy that won’t require what market pricing implies. The unemployment rate jumped to 5.6% in Q2, the highest level since Q3 2015. Risks are skewed to the downside for NZD and even if the RBNZ does deliver a hawkish hike, investors will at some point likely question the extent of hikes priced. We expect NZD to underperform over the forecast period ahead," MUFG adds.

• AUD/USD +0.2% from Tue 0.70099 low despite resurgent USD index (+0.4% Tue)

• AU Q3 CPI release 0030 GMT, Reuters poll consensus 1.2% q/q, +3.9% y/y

• Contingent of RBA officials (including Bullock) before senate committee Wed

• FOMC widely expected to hold FFR steady Wed, dialogue will be critical

• WTI -1.7% as Middle East peace hopes temper supply fears for time being

• AUD sellers between 0.7033 100-DMA & 0.7055 200-DMA capping topside moves

• Range Asia 0.70125-40 support 0.6865 0.6834, resistance 0.7053 0.7282
DXY Daily 55/100/200-DMA


AUD Daily 21/100/200-DMA

(James Connell is a Reuters market analyst. The views expressed are his own.)

The dollar rose against most of its G10 peers on Tuesday as buoyant risk sentiment and upbeat US data lifted Treasury 2-year yields ahead of Wednesday's FOMC policy decision.

Meta Platforms raised its equity offerings to a record $97.5 billion, with the common stock offering five times oversubscribed, Bloomberg reported.

Durable goods orders rose 1.8% in September, while stronger-than-expected August home prices, firmer October regional Fed surveys and higher weekly Redbook sales underscored resilient US domestic demand.

Oil prices eased as optimism over Middle East peace efforts offset concerns about Strait of Hormuz shipping risks and Houthi attacks on Saudi Arabia facilities.

Qatar said Iran must demonstrate good intentions for mediation efforts to succeed following talks in Tehran.

The dollar index continues to trend higher in light turnover after clearing its 21-DMA at 101.99, with risk reversals showing growing demand for dollar upside across maturities.

EUR/USD was pressured below its 10- and 21-DMAs amid firmer Treasury yields, exposing its 1.1135 lower Bollinger after slipping under the 1.1140 level.

GBP/USD drifted lower, but light pre-event positioning ahead of the UK Budget and Fed meeting, coupled with expectations for a November BoE hike, helped anchor the pair above 1.3300.

USD/JPY held a firm tone near the 21-DMA at 157.90, with a break above 158.00 targeting the cloud top at 158.44 and 200-DMA at 158.55, while a drop below the Tenkan-sen at 157.32 would expose the lower end of the 156.98-158.89 Bollinger range.

AUD/USD was supported above 0.70 by firmer CNH and metals, ending just below its 0.7040 high and 100-DMA ahead of Australian CPI, while AUD/NZD edged higher into an RBNZ decision.

USD/CAD moved above its 100-DMA at 1.4046 ahead of Wednesday's Bank of Canada decision, recovering after Friday's brief break below 1.4000

Treasury yields rose as much as 2 basis points as the curve flattened. The 2s-10s curve dipped 1 basis point to +25.7bp.

The S&P 500 rose 0.52%, fueled again by tech shares.

WTO oil fell 1.8%, dipping below $100/bbl.

Gold rose 0.99% while copper gained 1.73%.

Heading toward the close: EUR/USD -0.33%, USD/JPY +0.28%, GBP/USD -0.22%, AUD/USD +0.16%, DXY +0.34%, EUR/JPY -0.04%, GBP/JPY +0.09%, AUD/JPY +0.44%.(Editing by Burton Frierson Robert Fullem is a Reuters market analyst. The views expressed are his own)

• NY opened near 1.1150 after 1.1177-1.1136 traded overnight

• Early rally toward 1.1155 met sellers as USD, US yields

rallied

• The pair then fell even as gold, silver, stocks rallied & USD/CNH neared 6.6635

• EUR/USD fell below 1.1140 during NY's afternoon, traded down -0.30%

• Techs are bearish; RSIs indicate downward momentum, pair below 10- & 21-DMAs

• Widening Bollinger bands reinforce the bearish tech signals
eurusd

(Christopher Romano is a Reuters market analyst. The views expressed are his own)

Morgan Stanley Research likes long USD/JPY exposure as a strategic hedge against further rise in global bond yields. 

"JPY is the G10 currency most negatively exposed to increases in average global yields. This property of JPY supports our preference for USD/JPY longs, particularly given the limited room for the BoJ to deliver a hawkish surprise relative to market expectations," MS notes.

"We estimate USD/JPY fair value above 170, suggesting continued upside potential if US-Japan yield differentials widen further," MS adds.

• Cable dips towards 1.3308 ahead of the London fix (4pm GMT)

• 1.3308 was one-week low during the London morning

• Last week's low was 1.3300 (before rally to 1.3418, five-week high)

• US Oct consumer confidence index 91.7 vs 81.0 forecast

• Fed rate hold expected on Wednesday. UK budget on Wednesday too

• US core PCE data due on Thursday. BoE rate hike expected next week

GBPUSD

(Robert Howard is a Reuters market analyst. The views expressed are his own)

Bank of America Global Research previews tomorrow's October FOMC decision.

"BofA economists are the market outlier in their call for an Oct hike.. We agree the Fed should hike, but markets price a Fed willing to wait until after the election, especially given rising credit risks. Ultimately, persistent inflation could drive further Fed tightening," BofA notes

"USD risks skew to the downside on a hold. A convincing, hawkish hold could leave the USD and rates broadly near current levels, while a dovish or poorly explained hold risks renewed Fed credibility concerns, bear steepening in 2s30s and potentially significant USD weakness," BofA adds.

• Ether traded 2295.49-2337.20 overnight, near 2320.00 early NY, up +0.81%

• It traded up slightly despite USD buying & US yield

gains

• Equity gains & gold, silver rallies off their lows helped buoy Ether

• Despite Ether's gains the technical picture does not bode well for bulls

• Ether is currently consolidating its drop from the October 21 daily high

• It trades below the 10- & 50-DMAs, monthly RSI indicates downward momentum

• The 38.2% Fib of the 1510.95-2805.45 rally is acting magnetically for now

• 200-DMA, 50% Fib of 1510.95-2805.45 eyed if consolidation resolves downward
eth

(Christopher Romano is a Reuters market analyst. The views expressed are his own)

Goldman Sachs Research previews tomorrow's October FOMC decision.

"Comments from FOMC participants since their last meeting point to a compromise to raise the funds rate every other meeting. This means that the FOMC is set to skip raising rates at its October meeting but is likely to deliver a second hike in December," GS notes.

"We do not expect significant new information from the press conference. The seemingly strong support for hiking every other meeting means there is likely a high bar to deviate from that plan through the end of the year, which should limit the impact of Fed communication for now," GS adds.

• 1.1177-1.1136 traded overnight, NY opened near 1.1150, down -0.24%

• Drops in US yields , oil , USD/CNH couldn't inspire bulls

• Broad-based USD buying & drops in gold, silver weighed down EUR/USD

• The pair's recent drop now has technicals leaning towards the bearish camp

• Daily, monthly RSIs indicate downward momentum, pair is below 10- & 21-DMAs

• Widening 15-month Bollinger bands reinforce the bearish tech signals
eurusd

(Christopher Romano is a Reuters market analyst. The views expressed are his own)

• 0.7010-0.7036 traded overnight, NY opened near 0.7030, up +0.24%

• AUD/USD rallied despite general USD strength, drops in gold, silver

• US yield , USD/CNH drops & copper, stock gains buoyed AUD/USD

• The pair's resiliencey in the face of UD strength has techs flashing bull signals

• Daily, monthly RSIs indicate upward momentum, pair above 10- & 21-DMAs

• Ongoing consolidation of rally off Oct. 15 low, monhtly bull hammer add to bull signs
audusd

(Christopher Romano is a Reuters market analyst. The views expressed are his own)

• EUR/USD down 1.1235 to 1.1152 this week

• The year low is 1.1113

• The 200-WMA is 1.1108 - pair above this since Apr 2025

• A 50% retrace 1.0125-1.2084 2025-2026 rally is 1.1105

• Target for a break below 1.1105 is 1.0873

• Potential sell signal if 21WMA falls below 100-WMA

• EUR/USD set to close below a vital level, big losses likely

•
EURUSD

(Jeremy Boulton is a Reuters market analyst. The views expressed are his own)

• AUD/USD maintains 0.70 handle before Australian Q3 CPI data at 0030 GMT

• Up 1.2% QQ, 3.9% YY forecast. Core forecast at 1.0% QQ, 3.6% YY

• Hotter than expected data would raise risk of RBA rate rise next week

• It might also inflate AUD/USD towards 0.71 (last at 0.71 on Sept 23)

• Markets currently see 65% chance of RBA hike on Nov 3

• Two-day Fed meeting gets underway later; rate hold expected Wednesday

AUDUSD

(Robert Howard is a Reuters market analyst. The views expressed are his own)

• EUR/USD is trading below the 100-MMA at 1.1194

• Pair slumped rough 1.19 toward 0.95 on last closing break below

• The 100-MMA then capped EUR/USD for several years

• Immediate target for a break is 1.0873

• Potentially EUR/USD could retrace entire 1.0125-1.2084 rise

• Much higher oil weighing EUR/USD and vital level for crude close

•
EUR/USD

(Jeremy Boulton is a Reuters market analyst. The views expressed are his own)

• Cable falls to 1.3317 as dollar strengthens before two-day Fed meeting starts

• 1.3317 is one-week low. Bids likely near 1.3300 (last week's low)

• Oct 22 low of 1.3355 is now a resistance level (1.3346 was Asia high)

• UK's minimum wage to rise nearly 4%, Times reports. UK budget on Wednesday

• British Retail Consortium warns "dam is starting to break" on price rises

• Bank of England is expected to raise its policy rate to 4% next week (Nov 5)

GBPUSD

(Robert Howard is a Reuters market analyst. The views expressed are his own)

• Shares of FireFly Metals rise as much as 10.1% to A$1.42, their highest level since October 16

• Copper-gold explorer reports high-grade copper-gold discovery at Mount Joy prospect within its Green Bay project in Canada

• FFM last up 7.2%, on track for best day since early August

• Stock down 32.2% YTD, including moves in current session

(Reporting by Swetha Lakshmi in Bengaluru)

• GBP/USD unchanged in Asia after closing 0.2% lower Mon on broad dollar rally

• Inability to post gains despite positive risk sentiment, lower oil weighs

• Repeated failures at 55-day MA, currently at 1.3408, leads to momentum loss

• Caution ahead of UK budget & Fed rate decision on Wed likely to cap rallies

• Mindful of the markets, UK's Healey is set to deliver a careful budget

• Britain's minimum wage to rise nearly 4%, Times reports

• UK retail body warns 'dam is starting to break' on price rises

• Resistance 1.3360, 1.3390-1.3400, support 1.3325, 1.3300-05, 1.3280

• Monday range 1.3326-1.3388, Asia 1.3335-1.3346
GBP:

(Krishna Kumar is a Reuters market analyst. The views expressed are his own.)