The New Zealand bonds traded higher as investors are curiously eyeing the GlobalDairyTrade (GDT) price auction, scheduled to be held on April 5 for detailed direction in the debt market. Also, a downbeat reading in the country’s business confidence supported bond prices.
The yield on the benchmark 10-year bond, which moves inversely to its price, slumped 7 basis points to 3.11 percent, the yield on 7-year note plunged 4 basis points to 2.74 percent and the yield on short-term 2-year note also traded 3-1/2 basis points lower at 2.11 percent.
The NZIER Quarterly Survey of Business Opinion suggests that activity continues to grow at a moderate pace and that inflation is rising. General business confidence eased in the March quarter, with a net 16 percent of firms expecting better conditions in coming months, down from 26 percent in September. Confidence is still much better than the zero percent reading a year earlier.
But despite the dip in confidence, firms remain upbeat about their own business prospects, which is typically the better indicator for economic growth. A net 21 percent of firms reported stronger activity over the quarter, and a net 25 percent of firms expect improved activity in the quarter ahead.
Meanwhile, the New Zealand’s benchmark S&P/NZX 50 Index traded 0.20 percent higher at 7,239.53, while at 04:00 GMT, the FxWirePro's Hourly NZD Strength Index remained neutral at -12.94 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex
