Forex Today: RBNZ opts for a 50 bps cut, FOMC Minutes next

Here is what you need to know on Wednesday, October 9:

The action in financial markets remain choppy midweek, with investors' search for the next catalyst continues. The US economic calendar will feature Wholesale Inventories data for August. Later in the day, the US Treasury will hold a 10-year note auction and the Federal Reserve (Fed) will publish the minutes of the September policy meeting.

The US Dollar (USD) Index, which tracks the USD's valuation against a basket of six major currencies, closed the second consecutive day virtually unchanged on Tuesday. The index edges slightly higher and stays above 102.50 in the European morning on Wednesday. The risk-averse market environment seems to be helping the USD hold its ground. At the time of press, US stock index futures were down between 0.2% and 0.4% on the day. Meanwhile, China's Shanghai Composite Index fell nearly 7% and Hong Kong's Hang Seng Index lost over 1% after Reuters reported that China's Finance Ministry is set to roll out a 2 trillion Yuan fiscal stimulus package on October 12. 

Following its October policy meeting, the Reserve Bank of New Zealand (RBNZ) decided to lower the policy rate by 50 basis points (bps) to 4.75% from 5.25%. In its policy statement, "the New Zealand economy is now in a position of excess capacity, encouraging price- and wage-setting to adjust to a low-inflation economy," the RBNZ noted. NZD/USD came under heavy bearish pressure in the Asian trading hours and was last seen trading at its lowest level since Mid-August below 0.6100.

Following Tuesday's recovery attempt, EUR/USD stays on the back foot early Wednesday and retreats toward 1.0950.

GBP/USD registered small gains on Tuesday but failed to stabilize above 1.3100. The pair was last seen trading modestly lower on the day near 1.3080.

USD/JPY closed the day flat on Tuesday but started to stretch higher in the Asian session on Wednesday. As of writing, the pair was up 0.3% on the day at 148.60.

Following a bearish start to the week, Gold extended its slide and touched its lowest level in over two weeks near $2,600 on Tuesday. Although XAU/USD erased a small portion of its daily losses later in the American session, it failed to gather recovery momentum. In the European morning, Gold trades in the red at around $2,610.