By Cecile Lefort and Rebecca Howard
SYDNEY/WELLINGTON, Dec 24 (Reuters) - The Australian and New Zealand dollars were largely sidelined on Thursday in light pre-holiday trade, but were on track to post solid gains for the week due to a hunt for yield.
The Australian dollar AUD=D4 was steady at $0.7240, from a trough of $0.7209 on Wednesday. It has rallied 2 percent since touching a low last week. Resistance was found at $0.7250 with a stronger barrier near $0.7280.
Much of the strength came from heavy buying interest from real money accounts, suggesting carry trade demand is still in play for some.
Australian two-year government bonds AU2YT=RR yield around 2 percent, well above the 0.5 percent of Canada or Britain or negative rates of Germany and Japan.
New Zealand pays even more with two-year bond yields NZ2YT=RR at 2.7 percent.
Dealers said custodians reported unusually large flows into the Antipodeans in the past month. http://reut.rs/1QXh6sZ
The New Zealand dollar NZD=D4 held steady at $0.6796 in thin pre-Christmas trading. It touched a two-month peak of $0.6836 on Tuesday, putting it on track for a rise of nearly 1 percent this week.
New Zealand government bonds 0#NZTSY= eased slightly, with yields up 1.5 basis points in the middle of the curve.
Australian government bond futures were very quiet, with the three-year bond contract YTTc1 steady at 97.940. The 10-year contract YTCc1 was down 1 tick at 97.1450, while the 20-year contract YXXc1 was off half a tick at 96.6550.
New Zealand and Australian markets will close early Thursday for a four-day holiday.
(Editing by Jacqueline Wong)