SYDNEY, March 4 (Reuters) – Australian and New Zealand dollars went down on Thursday after another spike in the yield of global bonds removed investors from riskier assets, despite sentiment backed by data that was showing Australian trade surplus.
The Aussie stood at $ 0.7785, after falling from $ 0.7839 overnight as a jump in U.S. Treasury yields hit lower equities. Importantly, it managed to stay away from key support around $ 0.7693, keeping the recent uptrend alive.
The kiwi dollar held at $ 0.7251, after also declining from an overnight peak of $ 0.7302. Hardware support is around $ 0.7210.
Renewed sales in Finance against local markets with Australian 10-year bond yields rebounded up 1.79%, from a low of 1.628% at the start of the week.
Three-year cash yield was capped at 0.14% as the Reserve Bank of Australia (RBA) maintained the 0.1% target. But futures fell 6 ticks to 99.645, resulting in a yield of 0.355%.
While the RBA has now bought around 60% of the April 2024 bond issued, it has less control over the much deeper and more liquid futures market.
In any case, the central bank has rested on the rise in yields as it largely expresses optimism about the global economy with vaccines being rolled out and U.S. fiscal stimulus on the way.
The domestic economy is thriving with figures out this week showing the two strongest growth quarters on record, with the country ‘s trade surplus rising to a historic high of A $ 10.1 billion ( $ 7.86 billion) in January.
“Australia has posted 37 consecutive monthly trading currencies,” said CommSec chief economist Craig James, adding that the 12-month total was also a record at A $ 80.1 billion.
“The rest of the trade fundamentally supports the Australian dollar. ”
Across the Tasman, New Zealand Reserve Bank Governor Adrian Orr stressed that central banks were deliberately looking to push inflation above target to make up for years of underperformance.
That was one reason New Zealand’s 10-year yield was up 1.87%, 39 basis points above finance.
$ 1 = 1.2852 Australian Dollars Edited by Lincoln Feast.