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NZ dollar retreats as risk avoided; bonds flat
Wednesday November 25, 09:16 AM
WELLINGTON, Nov 25 (Reuters) - The New Zealand dollar NZD= was softer on Wednesday amid reduced appetite for risk and sought the safe haven of the U.S. dollar after data suggested economic recovery may be slower and weaker than expected.
* Kiwi resumes local trading around $0.7250 level after a choppy past 24 hours during which stocks weakened and a slew of data in Europe and United States added to an uncertain outlook.
* U.S. dollar gains against the euro and other growth-related currencies as data shows the U.S. economy grew at a slower pace in the third quarter than previously thought, and other data shows consumer confidence edging higher. See [ID:nN24300840]
* Minutes of Federal Reserve's November meeting show officials increasingly confident about U.S. recovery although employment not seen picking up soon. See [ID:nWEQ003609]
* Yen rises to a six-week high against the U.S. dollar as the mixed bag of data enhances the currency's safe haven attraction.
* Investors also seen as being wary about committing to positions ahead of U.S. Thanksgiving Day holiday on Thursday.
* Survey for RBNZ shows inflation expectations for the next two years jumping sharply, with economic growth seen picking up, and interest rates expected to rise. See [ID:nWEL480833]
* National Bank of NZ's business outlook on Thursday seen as main local data event.
* Expectations of Reserve Bank of New Zealand's rate tightening ease further with financial markets cutting chances for a March rate hike to around 30 percent, although a rise in April remains fully priced in. NZDIRS
* Near term support for the kiwi seen at $0.7170/80 with resistance at $0.7270/80.
* NZ bonds largely flat, while U.S. Treasuries gain as an auction of five-year notes attracts strong demand. See [US/]
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