Australia, NZ dollars limp off lows, helped by data

[SYDNEY] The Australian drifted up from deep lows on Thursday as some upbeat domestic data gave bears an excuse to pocket profits on the currency's recent slide.

The Australian dollar edged up to US$0.7489, from US$0.7460 early and away from a seven-week trough of US$0.7447 touched on Wednesday. Resistance was found near US$0.7515 with support at US$0.7455.

The Aussie, which is still down more than two US cents since Tuesday's rate cut by the Reserve Bank of Australia (RBA), received a modest boost after data showed the country's trade deficit narrowed sharply in March.

A healthy 4 per cent jump in exports helped shrink the deficit to A$2.1 billion (S$2.13 billion), beating forecasts for A$2.9 billion. Retail sales also surprised with a gain of 0.4 per cent in March.

ANZ expects the Aussie to consolidate ahead of US payrolls data on Friday with a slight softer bias, the bank said in a note.

Underpinning the Antipodean currencies somewhat are bond yields that still dwarf those of many rich world peers. According to a Fitch report, there are US$10 trillion worth of bonds overseas paying less than zero, with Japan accounting for two-thirds of the total.

In contrast, Australian debt pays between 1.7 per cent and 2.4 per cent out to 10 years.

The New Zealand dollar rose to US$0.6893 from a low of US$0.6861 touched on Wednesday.

It has shed 1.1 per cent so far this week in the wake of the RBA's easing and sliding global prices for dairy products, the nation's top export earner. Analysts expect the currency to trade between US$0.6860 and US$0.6960.

New Zealand government bonds gained, sending yields eight basis points lower at the long end of the curve.

Australian government bond futures rose to two-month highs, with the three-year bond contract up three ticks at 98.310.

The 10-year contract added five ticks to 97.6250, while the 20-year contract gained 5.5 ticks to 97.0250.

REUTERS