New Zealand bonds close flat in subdued trading session

The New Zealand bonds remained flat at the time of closing Thursday as investors remain sidelined amid a muted trading session that witnessed data of least economic significance.

At the time of closing, the yield on the benchmark 10-year bond, which moves inversely to its price, closed flat at 3.05 percent, the yield on 7-year note rose 1/2 basis point to 2.72 percent while the yield on short-term 2-year note also remained steady at 2.10 percent.

Positive momentum in dairy prices continued to build in the latest GlobalDairyTrade auction, with the aggregate price index rising 3.6 percent.  That’s the fourth consecutive gain, and takes prices to the highest level since early February.

While demand from China has remained solid and this is helping to put a floor under prices, dairy prices seem to be responding to concerns about New Zealand supply off the back of recent poor weather.

Lastly, the unemployment rate fell to 4.9 percent in the March quarter, a lower level than analysts had expected. The larger than expected drop in unemployment reflected stronger than expected jobs growth, with the number of people in employment rising by 29,000 over the quarter.

Meanwhile, the New Zealand’s benchmark S&P/NZX 50 Index closed 0.37 percent lower at 7,378.42, while at 06:00GMT the FxWirePro's Hourly NZD Strength Index remained neutral at -104.24 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex