New Zealand 10-year bond yields plunge to 1-1/2 month low, 5-year yields lowest in 5 weeks

The New Zealand 10-year bond yields plunged to almost 1-1/2 month low Thursday, while the medium-term 5-year bond yields hit lowest in over five weeks, following recovery in global debt market.

In intraday trading, the yield on the benchmark 10-year bond, which moves inversely to its price, cracked 10 basis points to 3.12 percent, the yield on 7-year note plunged nearly 7 basis points to 2.79 percent and the yield on the short-term 2-year note slid 4-1/2 basis points to 2.20 percent.

The New Zealand bonds have been closely following movements in the U.S. debt market. The U.S. benchmark 10-year bond yields fell 6 basis points to 2.33 percent, from yesterday’s high of 2.39 percent.

Moreover, Donald Trump in his public appearance said that he is handling over his personal businesses to his son to avoid future discrepancies. Regarding a relationship with Russia, he claimed that association with Vladimir Putin is an asset, rather than a liability.

Moreover, last week, the dairy product prices have fallen at Fonterra's GlobalDairyTrade auction, sliding for a second consecutive auction as whole milk powder prices unexpectedly sank amid increased volume on offer.

The GDT price index fell 3.9 percent to USD3,463, down from USD3,656 at the previous auction two weeks ago. Some 22,396 tonnes of product was sold, edging up from 22,321 tonnes at the previous auction. Whole milk powder dropped 7.7 percent to USD3,294 a tonne.

Also, investors are now looking forward to a host of speeches from the Federal Open Market Committee (FOMC) members later in the day. Lastly, market participants will also be awaiting the New Zealand’s consumer price inflation data, scheduled for release next week for further direction in the debt market.

Meanwhile, the New Zealand’s benchmark S&P/NZX50 Index closed 0.08 percent lower at 7,063.59, while at 6:00GMT, the FxWirePro's Hourly NZD Strength Index remained slightly bullish at 86.25 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex