News and Events:

The recent support the USD has garnered on speculation that the Fed would begin to drain liquidity and tighten rates seems to be waning.The USD was weaker across the board in the Asian session, as risk appetite returned (regional equity indexes were broadly higher).Risky assets also got a boost from the news that the US Treasury has cleared 10 banks to repay TARP funds.Tonight in New Zealand, the RBNZ is expected to hold rates at 2.50%. However there is a significant number of analysts expecting a rate cut (bills market are pricing in a cut of 36bp).