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The New Zealand bonds remained downbeat at the time of closing Tuesday as investors remain cautious to observe the GlobalDairyTrade (GDT) price auction, scheduled to be held later today. In addition, the Reserve Bank of New Zealand’s (RBNZ) monetary policy decision, due on late Wednesday will add further direction to the debt market.
At the time of closing, the yield on the benchmark 10-year bond, which moves inversely to its price, jumped 3 basis points to 2.81 percent, the yield on 7-year note also surged 3 basis points to 2.72 percent and the yield on short-term 5-year note traded 3 basis points higher at 2.51 percent.
In the last GDT price auction, dairy prices rose 0.6 percent, following a 3.2 percent gain previously. This was the 6th successive gain with prices rising close to 15 percent in the past two months.
"We expect the Reserve Bank to hold the OCR at 1.75 percent and to maintain a neutral outlook for interest rates," Westpac commented in its latest research report.
Lastly, the country’s Westpac McDermott Miller Consumer Confidence survey recorded a 1.5 point rise in June, taking the index to 113.4, the highest since early 2015. And looking into the breakdown of this quarter's survey, gains in confidence have been widespread, both geographically and by income levels.
Meanwhile, the New Zealand’s benchmark S&P/NZX 50 Index closed 0.07 percent lower at 7,586.53 while at 05:00GMT, the FxWirePro's Hourly NZD Strength Index remained slightly bullish at 85.37 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex
