Gold Prices Fall Amid Rate Jitters; Copper Steady as China Stimulus Eyed 
The New Zealand government bonds closed narrowly mixed Friday ahead of the long weekend as markets will remain closed Monday on account of Labour Day.
The yield on the benchmark 10-year bond, which moves inversely to its price, fell 1/2 basis point to 2.615 percent, the yield on 7-year note ended steady at 2.29 percent and the yield on short-term 2-year note rose 1 basis point to 1.96 percent.
On Wednesday, New Zealand’s Global Dairy Trade (GDT) price index improved 1.4 percent at the latest price auction, from an unexpected 3.0 decline previously. Also, average milk price rose to USD 2,965 per metric tonne, compared to prior USD 2,880 per metric tonne.
New Zealand’s third-quarter consumer inflation rose by 0.2 percent, higher than the market expectations of flat outcome, from up 0.4 percent in the previous quarter. On an annual basis, inflation dropped to 0.2 percent, the eighth straight quarter below 1 percent. However, we foresee that today's inflation reading was not far from the central bank's expectation, and will not stand in the way of it cutting the official cash rate again in November.
Moreover, the Reserve Bank had forecast a 0.1 percent increase in its August Monetary Policy Statement. The annual inflation rate slowed from 0.4 percent to 0.2 percent, just above the record low of 0.1 percent that it briefly touched in December last year, reported Westpac in its Research note.
The Reserve Bank of New Zealand is still widely expected to cut rates at its November 10 policy meeting, economists are now much more sceptical about cuts after that, reported Reuters.
Meanwhile, the New Zealand’s benchmark S&P/NZX50 Index closed down 15.38 points to 6,958.40.
