Gold Prices Fall Amid Rate Jitters; Copper Steady as China Stimulus Eyed 
The New Zealand 10-year Treasury yields jumped above 3 percent mark Friday for the first time in eight months following weakness in the global debt market. Also, a higher implied probability of the United States Federal Reserve December interest rate hike drove out investors from safe-haven buying.
The yield on the benchmark 10-year bond, which moves inversely to its price, rose 9 basis points to 3.065 percent, the yield on 7-year note also ended 7-1/2 basis points higher at 2.733 percent and the yield on short-term 2-year note slid 1 basis point to 2.135 percent (rose 5 basis points from yesterdays close of 2.085 percent).
On Wednesday, the United States Republican candidate Donald Trump pinned his victory against Democrat opponent Hillary Clinton in the 2016 presidential election. Investors again revised the outlook for US interest rates after Donald Trump's victory, with the probability of a December rate hike by the Federal Reserve going from as low as 30 percent to as high as 80 percent.
The rout in bonds came as the Republican nominee’s seizure of the White House stoked investor expectations that inflation will accelerate and traders pared their bets on further monetary easing by central banks in Australia and New Zealand. U.S. bonds declined on Wednesday as a $23 billion Treasury auction of 10-year notes saw the lowest demand since the financial crisis, with interest from foreign buyers particularly weak. Yields on 30-year American notes increased the most in more than five years, Bloomberg reported.
Moreover, initial jobless claims in the United States fell during the week ended Nov 5, from almost a three-month high in the run-up to the country’s most impactful Presidential election concluded Nov 8, with the results being declared on the following day. Also, the fall in the number of people opting for unemployment benefits has strengthened the probability of a December interest rate hike by the Federal Reserve.
U.S.’s jobless claims fell by 11,000 to 254,000 in the week ended November 5, data released by the Labor Department report showed Thursday in Washington. The median forecast in a Bloomberg survey called for 260,000. Continuing claims rose, though the four-week average dropped to the lowest since 2000.
On Thursday, the Reserve Bank of New Zealand in its November monetary policy meeting lowered the official cash rate once again by 25 basis points, after easing in August, a move taken for the seventh time since June 2015, in an attempt to boost the slow-moving economy. Further cuts have not completely been ruled out, especially given the continuing uncertainty around the global environment and lingering softness in inflation.
However, developments over the past few months have been positive for the New Zealand economy, and the downside risks to the RBNZ’s view have diminished. We expect that the OCR will remain on hold for an extended period. However, longer term rates look set to rise from here, said Westpac in its research report.
Meanwhile, the New Zealand’s benchmark S&P/NZX50 Index closed down 35.94 points to 6,697.78. While at 06:00 GMT, the FxWirePro's Hourly New Zealand Dollar Strength Index stood neutral at -53.42 (lower than the range of -75 to -100 for bearish trend).
