New Zealand bonds close mixed as investors remain side-lined in quiet trading week

The New Zealand bonds closed higher Friday as investors remained side-lined amid a muted trading week that is scheduled to witness data of little economic significance.

At the time of closing, the yield on the benchmark 10-year note, which moves inversely to its price, rose 1/2 basis point to 2.605 percent, the yield on the long-term 20-year note slid 1/2 basis point to 2.915 percent and the yield on short-term 2-year closed nearly flat at 1.705 percent.

Two risks highlighted by the Fed at the Jackson Hole Symposium are: premature tightening as a result of moving too quickly and shortening the expansion, or moving too slowly and allowing for overheating of the economy, OCBC Treasury Research reported.

A continuation of a healthy labour market and income growth would reaffirm further gradual increases in the target range for the Fed funds rate, as Powell indicated in his speech. Several Fed policy makers reiterated their commitment to monetary policy decision-making "without regard to political considerations or influence", hinting that President Trump’s recent complaints were unlikely to impact the pace of rate hikes significantly, the report added.

Meanwhile, the NZX 50 index closed 0.51 percent higher at 9,206.42, while at 06:00GMT, the FxWirePro's Hourly NZD Strength Index remained neutral at -16.21 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex