The New Zealand dollar took a spill on Wednesday after disappointing jobs data only added to expectations that interest rates would have to be cut, perhaps as soon as this month. The kiwi dollar was down 0.37 percent at $0.6648, having been as low as $0.6625 at one stage.
That helped the Australian dollar hop up 0.4 percent to NZ$1.0606 and away from important chart support at $1.0550. The Aussie was also a fraction firmer on the US dollar at $0.7053, though trade was very thin with much of Asia and Europe on holiday.
The kiwi's slip came after government data showed employment unexpectedly fell in the March quarter, even as the jobless rate eased a tick to 4.2 percent.
Yields on two-year government bonds likewise fell back to 1.42 percent, having been as high as 1.475 percent on Tuesday. The RBNZ meeting happens to come a day after the Reserve Bank of Australia (RBA) holds its policy meeting for May. It is also under pressure to ease given inflation has proved surprisingly weak and the housing market continues to slide.
Australian government bond futures were unchanged as the market awaited the outcome of the US Federal Reserve's policy meeting later in the day.
The three-year bond contract held at 98.745, with the 10-year contract at 98.2000.
Wage growth also unexpectedly slowed to an annual 2.0 percent, suggesting the weakness seen in inflation during the March quarter might not be transitory.