The Australian and New Zealand dollars edged higher on Thursday in thin holiday trading but stayed near multi-month lows on sustained demand for the greenback. The Australian dollar was up 0.24 percent at $0.7191, bouncing off a seven-month trough of $0.7160 hit last week. The Aussie has fallen in seven out of the last 10 sessions.
The New Zealand dollar ticked 0.14 percent higher to $0.6925, after rising 0.4 percent the previous day. Both the Aussie and the Kiwi have been particularly hard hit since early November after Donald Trump won the US Presidential elections, sending Treasury yields and the dollar soaring on expectations of stronger US growth and inflation.
The Aussie is set to end the year down 1.3 percent, its fourth straight year of losses. New Zealand government bonds jumped in line with US Treasuries following strong demand for its 5-year debt.
The US Treasury Department auctioned $34 billion of 5-year notes, which fetched a high yield of 2.057 percent, the highest since April 2011. The auction also yielded the highest bid-to-cover ratio since November 2014 and record high buying from indirect bidders. Australian government bond futures rose too, with the three-year bond contract up 6 ticks at 97.930. The 10-year contract climbed 7 ticks to 97.1750.
In comparison, the kiwi is seen ending with an annual gain of 1.4 percent, having found support from a string of upbeat economic data at home. Figures last week showed New Zealand's third-quarter gross domestic product rose 3.5 percent year on year, putting it among the rich world's fastest-growing nations. Also helping the kiwi was a recovery in prices of dairy, New Zealand's top export earner.