By Cecile Lefort and Rebecca Howard
SYDNEY/WELLINGTON, May 27 (Reuters) - The Australian and New Zealand dollars found a toehold above recent lows on Friday, but both currencies were still poised for hefty monthly losses.
The Australian dollar edged up to $0.7224, off a near three-month trough of $0.7145 set on Tuesday, with investors cautious ahead of a busy week at home with gross domestic product, retail sales and trade data due for release.
Major resistance was found around $0.7250 with support near 72 cents.
The Aussie enjoyed a bit of respite following a bounce in oil prices.
"With oil price breaking above USD$50.00 per barrel, a wave of commodity currency buying has also erupted," said Stephen Innes, senior trader at FX and CFD firm OANDA Australia and Asia Pacific.
Still, the Aussie was on track for a 5 percent fall this month, the largest drop since July 2015. The slip was largely due to a diverging interest rate outlook between the U.S. Federal Reserve and the Reserve Bank of Australia (RBA).
Markets are now awaiting an address by Fed Chair Janet Yellen at 1715 GMT for clues on when interest rates may be raised again.
A string of Federal Reserve officials have in the past week bolstered expectations for a hike as early as next month.
In contrast, Australian debt futures 0#YIB: are fully priced for an easing by December, while their New Zealand counterparts also anticipate a rate cut this year by the Reserve Bank of New Zealand.
The New Zealand dollar NZD=D4 had a firmer tone at $0.6747, benefiting from some USD weakness following softer capital goods orders. Investors are largely treading water, with the next major risk event a speech by Fed Chair Janet Yellen.
"Any reference to the current economic state and monetary policy will be closely noted," said OM Financial Limited Private Client Manager Stuart Ive.
The kiwi has tumbled 3.2 percent this month, the second largest drop this year. It skidded to a two-month trough on Thursday after dairy giant Fonterra's disappointing milk payout forecast.
New Zealand government bonds 0#NZTSY= gained, pushing 3 basis points lower at the short end and 2.5 at the long end.
Australian government bond futures were mixed, with the three-year bond contract YTTc1 off 1 tick at 89.400. The 10-year contract YTCc1 shed 2 ticks to 97.7450, while the 20-year contract YXXc1 slipped 2.5 ticks to 97.0800. (Editing by Simon Cameron-Moore)