New Zealand bonds close lower on hopes of stronger GDT auction; Wheeler’s speech in focus too

The New Zealand government bonds closed lower Tuesday on expectations of stronger Global Dairy Trade (GDT) auction, thereby pushing prices in the dairy sector.

Also, investors will remain to focus on the upcoming Governor Graeme Wheeler speech scheduled to be held on Tuesday at 22:00 GMT.

The yield on the benchmark 10-year bond, which moves inversely to its price, closed 3 basis points higher at 3.26 percent, the yield on 7-year note ended up 1-1/2 basis points to 2.84 percent and the yield on 5-year note rose 1 basis point to 2.56 percent.

Moreover, New Zealand’s Prime Minister John Key surprisingly announced his resignation today after 8 years of service ahead of next general election, which is scheduled to be held in late 2017. Finance Minister Bill English is mostly expected to take over after Key’s formal resignation on next Monday.

Meanwhile, the New Zealand’s benchmark S&P/NZX50 Index closed up 55.65 points to 6,910.36. While at 05:00 GMT, the FxWirePro's Hourly New Zealand Dollar Strength Index stood neutral at +16.38 (higher than +75 represent a bullish trend).