Australia, NZ dlrs edge up, all eyes on Sino-U.S. trade talks
By Swati Pandey
SYDNEY, Oct 8 (Reuters) - The Australian dollar and its New Zealand cousin inched up on Tuesday, though expectations for further policy easing in both countries and caution about key Sino-U.S. trade talks capped gains.
The Aussie AUD=D4 was last up 0.1% at $0.6740, below technical resistance around $0.6780. A breach above could take it to $0.6800 - a level it has failed to sustain since late September.
The New Zealand dollar NZD=D4 was last up 0.3% at $0.6306, partly reversing Friday's 0.5% fall.
The antipodean currencies have been on a downtrend since early September as weaker-than-expected economic indicators pointed to a need for more policy easing by Australia and New Zealand.
However, both the Aussie and the kiwi have moved up from recent lows, mainly rooted in a pullback in the U.S. dollar as fears of recession in the world's largest economy increased.
Investor attention was squarely on pivotal trade talks between the United States and China, which began in Washington on Monday at deputy level.
Late this week, there will be top-level talks as Chinese Vice Premier Liu He meets U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin.
On Oct. 15, the United States is scheduled to increase tariffs on $250 billion worth of Chinese goods to 30% from 25%.
In Australia, a survey of business conditions released on Tuesday showed a slight improvement though the overall trend was still weak despite three rate cuts by the Reserve Bank of Australia (RBA) and signs of revival in the country's subdued housing market.
"Rate cuts will help but will lag and with weak consumer (sentiment) and higher global uncertainty, we are unlikely to see a material improvement in the short-term," NAB chief economist Alan Oster said.
A gauge of Australia's employment sector, also released on Tuesday, showed job advertisements steadied in September after a sharp decline the previous month.
"But this does not necessarily indicate a turning-point in the labour market," said ANZ senior economist Catherine Birch.
"We may see job ads deteriorate again in future months."
In New Zealand, the government reported a better-than-expected surplus of NZ$7.5 billion for the 2018/19 year, supported by a stronger economy.
New Zealand government bonds 0#NZTSY= were barely changed.
Australian government bond futures eased, with the three-year bond contract YTTc1 off 2 ticks at 99.44. The 10-year contract YTCc1 was off 1.5 ticks at 99.125.
(Editing by Richard Borsuk)
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