NZD underperforms

NZD consolidated over the Sydney morning, trading 0.7350 to 0.7373. It then fell 20 pips from 0.7348 as NZ PM Key said that the RBNZ is looking at new tools so it does not have to tighten policy and that there is no upward pressure on inflation. The kiwi then extended losses to 0.7323.
 
Iron ore futures in China stabilised, while copper slipped 1.4%. Australian long end rates followed US Treasuries, with 10yr yields rising to 2.74% - a high back to 6 Jan. 

AUD traded to a session high of 0.7728 but then fell to 0.7684. 

Westpac notes in a report on Monday:

• AUD/NZD chopped between 1.0460 and 1.0500. USD/JPY rose from 120.61 to touch 121.13 before slipping back below 121.
• The Nikkei fell in sympathy with US equities, down 0.9%. EUR/USD opened heavily and traded 1.0823, a fresh low back to 2003.