By Swati Pandey
SYDNEY/WELLINGTON, Nov 15 (Reuters) - The Australian dollar bounced from a one-month low on Tuesday, underpinned by rising commodity prices, and as a prediction of rising inflation from the country's central bank implied further interest rate cuts were off the agenda for now.
The Australian dollar AUD=D4 rose as high as $0.7582, after the Reserve Bank of Australia (RBA) released minutes of its November policy meeting in which it once again gave an upbeat assessment of the economy. touched $0.7524 on Monday, the lowest since Oct. 13, but has now steadied around $0.7556.
"There is a clear change in the Reserve Bank's attitude to inflation. Admittedly, it is not flashing warning signs," Craig James, chief economist at CommSec.
"Simply, interest rate settings are likely to remain stable until well into 2017."
RBA Governor Philip Lowe speaks in Melbourne later in the day and economists were keen to hear his views on whether U.S. President-elect Donald Trump's election promises would actually lift inflation and interest rates in the world's largest economy.
The Aussie has fallen 2.5 percent since Trump won the election last week, as investors sent the greenback and bond yields soaring.
"We are particularly interested to see the RBA's take on a post-Trump world in future meetings and speeches, now that the reflation trade is back," said Matt Simpson, Melbourne-based senior analyst at ThinkMarkets.
Elsewhere, the Aussie was slightly firmer against its New Zealand cousin AUDNZD= , but fell against the euro EURAUD= and the yen AUDJPY= .
The New Zealand dollar NZD=D4 stood at $0.7114, rising from a one-month low of $0.7070 touched on Monday.
New Zealand was still reeling from the impact of several powerful earthquakes, with transport links in the south island most heavily hit.
While the damage is still being assessed, analysts estimate rebuilding work could cost NZ$2.5 billion ($1.78 billion).
"A lingering effect from Monday's quake is likely to be higher inflation," said Nick Tuffley, ASB Chief Economist.
"Transport-associated costs look set to rise. Further, reconstruction work will add capacity pressures to an already-constrained construction sector, also impacting on inflation," Tuffley added.
At the margin, the quakes could narrow the odds of another rate cut by the Reserve Bank of New Zealand (RBNZ) next year if the economic disruption is greater than anticipated, Tuffley said.
The RBNZ cut interest rates this month to restrain a rising currency and push inflation higher even as the economy grew an annual 3.6 percent and the jobless rate dropped to near eight-year lows. Zealand government bonds 0#NZTSY= eased, sending yields about 2 basis higher at the longer end of the curve.
Australian government bond futures slipped, with the three-year bond contract YTTc1 down 2 ticks at 98.160. The 10-year contract YTCc1 edged half a tick lower to 97.37. ($1 = 1.4077 New Zealand dollars) (Editing by Kim Coghill)