The New Zealand dollar skidded on Thursday after mixed economic growth data cemented bets on interest rates staying at record lows for a long time yet, while the Australian dollar hung around 3-week highs. The kiwi eased more than a quarter of a cent after Thursday's figures showed the NZ$285 billion ($208 billion) economy grew 0.6 percent last quarter, when analysts had looked for 0.7 percent. The annual rate was a respectable 2.9 percent, just missing expectations for a robust 3.1 percent rise.
The kiwi was last down 0.3 percent at $0.7309, from as high as $0.7332 touched earlier in the day. Gross domestic product (GDP) in the December quarter was undermined by imports, particularly of capital goods, while dairy exports were hampered by unusually hot and dry weather.
Across the Tasman Sea, the Australian dollar was steady at $0.7879, not far from a three-week top of $0.7916 touched on Wednesday. The Aussie has been on a slow uptrend on a generally weaker greenback since the beginning of March, but renewed fears about a global trade war could weigh over time. New Zealand government bonds edged higher sending yields about 2.5 basis points lower at the long end of the curve.
Australian government bond futures were barely changed, with the three-year bond contract at 97.915 and the 10-year contract at 97.2700. There were few signs of inflation in the report despite strong private consumption, suggesting the Reserve Bank of New Zealand (RBNZ) will keep rates at 1.75 percent for a prolonged period.
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