The Australian and NZ dollars weakened against their major counterparts in the Asian session on Wednesday amid rising risk aversion, as a rally in treasury yields dragged down tech stocks.

Treasury yields rose on expectations for a Fed rate hike by mid-year to combat price pressures.

The benchmark yield on the 5-year note jumped to nearly a 2-year high, while that of its 10-year equivalent hit a 6-week high.

Traders await the latest Fed minutes due later in the day for more clues about the timing of the first rate hike.

Money markets are currently pricing in a high probability of a Fed rate increase in May, followed by two more by the end of the year.

The aussie fell to 0.7223 against the greenback, 83.76 against the yen and 1.5633 against the euro, from its early highs of 0.7245 and 84.16 and a 5-day high of 1.5572, respectively. The aussie is poised to challenge support around 0.70 against the greenback, 82.00 against the yen and 1.58 against the euro.

The aussie, however, rebounded to 1.0637 against the kiwi and 0.9202 against the loonie, following its prior lows of 1.0614 and 0.9180, respectively. The aussie is likely to find resistance around 1.08 against the kiwi and 0.93 against the loonie.

The kiwi eased to 0.6798 against the greenback, 78.80 against the yen and 1.6614 against the euro, after climbing to 0.6820, near 6-week high of 79.23 and a 6-day high of 1.6541, respectively in early trades. Next key support for the kiwi is possibly seen around 0.66 against the greenback, 76.00 against the yen and 1.70 against the euro.

Looking ahead, PMI reports from major European economies are due in the European session.

U.S. ADP private payrolls data for December is scheduled for release at 8:15 am ET.

Canada building permits and new housing price index for November will be published in the New York session.

The Fed minutes from the December 14-15 meeting are set for release at 2:00 pm ET.

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