Investing.com - The Kiwi rebounded in Asia on Wednesday as jobs data showed much stronger-than-expected readings with Australia to report its wage price index ahead.
In New Zealand, second quarter employment jumped 2.4%, compared with a 0.6% gain seen quarter-on-quarter for an unemployment rate of 5.1%, easily beating the expected 5.3% pace and well down from 5.7% previously. Producer prices rose 0.9% quarter-on-quarter for input, faster than the 0.5% gain seen, while the 0.2% rise for output came in as expected.
After of the data, NZD/USD traded at 0.7297, up 0.16%.
In Australia, the wage price index for the second quarter is seen up 0.5% quarter-on-quarter and at a 2.0% pace year-on-year. AUD/USD changed hands at 0.7698, up 0.05%.
Elsewhewre USD/JPY traded at 100.26, down 0.03%.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was last quoted at 94.75.
Overnight, the dollar remained broadly lower against the other major currencies on Tuesday, after the release of mostly downbeat U.S. economic reports continued to fuel concerns over the strength of the economy.
On Tuesday morning, the U.S. Bureau of Labor Statistics said its Consumer Price Index remained flat in July, in line with consensus forecasts, falling back slightly from a monthly gain of 0.2% in June. On an annual basis, consumer inflation rose by 0.8% from the previous 12 months, also slowing from June's yearly increase of 1.0%. It came as food prices remained flat and transportation experienced a slight contraction, offset by strength in medical and housing prices.
At the same time, Core CPI, which strips out volatile food and energy prices, rose by 0.1% in July, slightly below analysts' expectations for a 0.2% gain. Core Inflation increased by 2.2% on a year-over-year basis, also slowing from June's yearly gains of 2.3%. For the month, volatile energy prices declined by 1.6%. Despite strong signs of firming inflation at the start of the year, the Fed's long-term target for inflation still remains below its targeted objective.
Also on Tuesday, New York Fed president William Dudley jolted markets with hawkish comments on the likelihood that that the U.S. central bank could lift interest rates before the end of the year. Speaking exclusively with Fox Business, Dudley said the Fed is "getting closer" to that point when it "will be appropriate" to actually raise short-term rates. Following last December's historic interest rate hike, the Federal Open Market Committee (FOMC) has held the targeted range of its benchmark interest rate at its current level between 0.25 and 0.50% in each of its first five meetings this year.
The chances of a September rate hike from the CME Group's (NASDAQ:NASDAQ:CME) Fed Watch tool doubled to 18% following Dudley's comments from around 9% during the previous session. In addition, the CME Group placed the probability of a December rate hike at 55.1%, up from around 41.9% in Monday's session.
GBP/USD surged by more than 1.25% to 1.3043, bouncing from near 31-year lows from the previous session. It came after the CPI in Britain firmed by 0.6% in July, following a 0.5% monthly gain a month earlier, providing further indications that the U.K. economy could be on solid footing following June's Brexit shock. As the British Pound fell sharply throughout the month, import costs accelerated by the highest amount since 2011.