New Zealand bonds rise on election uncertainties, 10-year yields down 130bps

The New Zealand bonds rose during early Asian session Friday as investors poured into safe-haven instruments, following hovering uncertainties ahead of the September 23 general election.

The yield on the benchmark 10-year Treasury note, which moves inversely to its price, slumped 4 basis points to 3.07 percent, the yield on 7-year note plunged 41/2 basis points to 2.89 percent and the yield on short-term 2-year ended 3 basis points lower at 2.17 percent by 04:00GMT.

The meteoric rise of Labour, the shock fall of the Greens and the uncertainty of where exactly National sits in the polls means the election could still go anyway. Colmar Brunton has Labour ahead by four points at 44 percent while the latest Reid Research poll, released on Tuesday, puts National ahead by 10 points at 47 percent.

If the polls are anything to go by, the final result on September 23 is anyone's guess, with the two main polls forecasting vastly different outcomes. An aggregate poll puts the parties neck and neck - coalitions would once again be needed to form a government, something that's been standard for New Zealand since MMP started in 1996.

Meanwhile, the NZX 50 index traded flat at 7,795.48, while at 04:00GMT, the FxWirePro's Hourly NZD Strength Index remained highly bearish at -134.12 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex

FxWirePro launches Absolute Return Managed Program. For more details, visit http://www.fxwirepro.com/invest