[MARKET ANALYSIS] DXY takes a breather after recent gains, while participants await US CPI data and Warsh's testimony

DXY: -0.1%

• Takes a breather after gaining yesterday alongside the broad-based risk-off sentiment and hawkish comments from Fed's Waller, who stated that if there is another hot reading on core inflation this week, the Fed will need to consider a rate hike in the near term, and that they would need to see several months of lower core inflation to feel inflation is moving in the right direction. Furthermore, price action is contained overnight as participants await US CPI data and Fed Chair Warsh's testimony to Congress.

EUR/USD: +0.1%

• Attempts to recoup some lost ground, although the rebound is limited with the single currency lingering beneath the 1.1400 handle amid the lack of pertinent FX-specific drivers.

GBP/USD: +0.1%

• Bounced off the prior day's lows but lacks firm conviction after sliding from resistance at the 1.3400 level, while focus in the UK is on politics, with Andy Burnham to be crowned the leader of the ruling Labour party on Friday after winning 349 nominations out of 403 MPs, making it mathematically impossible for any rival to launch a challenge.

USD/JPY: -0.1%

• Slightly pulled back overnight after advancing yesterday in tandem with rising US yields and oil prices.

Antipodeans: AUD/USD +0.1% / NZD/USD +0.7%

• Clawed back some of their recent losses with NZD the outperformer after improved quarterly NZIER Business Confidence, while RBNZ Chief Economist Conway noted that a further reduction in monetary stimulus is likely to be required.