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Australia, NZ dlrs hold gains on improving risk appetites

Published 07/04/2016, 01:08 pm
Updated 07/04/2016, 01:10 pm
© Reuters.  Australia, NZ dlrs hold gains on improving risk appetites
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By Cecile Lefort and Charlotte Greenfield

SYDNEY/WELLINGTON, April 7 (Reuters) - The Australian and New Zealand dollars held gains on Thursday after a bounce in oil prices and a cautious U.S. Federal Reserve set a positive tone for risk assets.

The Australian dollar AUD=D4 , which bounced 0.7 percent on Wednesday, nudged up to $0.7609, closer to a recent nine-month peak of $0.7723. Resistance was found at $0.7635 and support at $0.7575.

Aiding investor sentiment were minutes of the Fed's last meeting, which showed many members reluctant to hike further in the face of global uncertainty.

However, the Aussie is still down a cent for the week, in part after the Reserve Bank of Australia (RBA) said a further rise in the currency would not be helpful to the economy.

The RBA held rates at a record low of 2 percent at a monthly policy meeting on Tuesday.

The Antipodean currencies also came under pressure against a vigorous yen, which was hovering near one-month highs. AUDJPY=R NZDJPY=R

The New Zealand dollar NZD=D4 was little changed at $0.6818, but up from $0.6773 the previous day.

The kiwi's slight strengthening is "more a reflection of the generalised USD weakness," BNZ analyst Jason Wong said in a research note.

A resurgent New Zealand dollar is making life harder for the nation's central bank, putting pressure on the vital dairy exports and raising the chance of another interest rate cut as early as this month. Zealand government bonds 0#NZTSY= gained, sending yields 1 basis points lower at the short end of the curve and 1.5 basis points lower at the long end.

Australian government bond futures pulled back from one-month highs, with the three-year bond contract YTTc1 off 3 ticks at 98.140.

The 10-year contract YTCc1 eased 4 ticks to 97.5300, while the 20-year contract YXXc1 fell 4.5 ticks to 96.9350. (Editing by Richard Borsuk)

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