By Wayne Cole
SYDNEY, April 3 (Reuters) - The Australian dollar dipped on Monday after domestic data on retail sales disappointed, though strength in home prices and construction helped limit the damage.
The Australian dollar AUD=D4 eased to $0.7613, from $0.7633 before the data, but remained within the recent trading range of $0.7587 to $0.7679. The New Zealand dollar NZD=D4 was little changed at $0.7008.
The Aussie decline came after data on retail sales showed a 0.1 percent fall in February, when analysts had looked for a rise of around 0.3 percent. Sales have been subdued for some time in part because discounting in the highly competitive sector is eating into nominal earnings.
There was brighter news on housing with approvals to build new homes jumping 8.3 percent in February and blowing away forecasts of a 1.0 percent drop.
Approvals to build new houses boasted the biggest increase in 14 months, suggesting the construction pipeline should stay healthy for some time yet.
Fresh supply is badly needed given how demand is driving prices ever higher in Sydney and Melbourne. Property consultant CoreLogic's index of home prices for the combined capital cities climbed 1.4 percent in March, taking annual growth to 12.9 percent. are responding with tighter lending restrictions. Australia's corporate watchdog on Monday said it was launching a new round of industry surveillance to ensure banks and brokers were not recommending overly expensive interest-only loans to customers.
That follows steps announced last week by the banking watchdog, the Australian Prudential (LON:PRU) Regulation Authority, to tighten rules on interest-only loans. Reserve Bank of Australia (RBA) is concerned that debt-fuelled speculation in property could ultimately hurt both consumers and banks, a major reason it has resisted pressure for more cuts in interest rates.
The central bank holds its April policy meeting on Tuesday and is considered certain to hold rates at 1.5 percent, and perhaps expand on its warnings over housing.
"These (regulatory) measures won't be enough to cool the market to the extent needed to allow the RBA to cut rates further to bring wage growth and inflation back to normal levels at a quicker pace," said CBA economist Kristina Clifton.
Australian government bond futures edged higher, with the three-year bond contract YTTc1 up 1 tick at 98.060. The 10-year contract YTCc1 rose 2.5 ticks to 97.2950.
New Zealand government bonds 0#NZTSY= also gained, pushing yields as much as 4.5 basis points lower at the long end of the curve. (Editing by Randy Fabi)