Australia, NZ dollars pause near multi-month peaks as bond selloff deepens

Business Recorder reported that the Australian and New Zealand dollars held close to recent multi-month highs on Tuesday, as a global bond sell-off kept traders cautious. The Aussie stood at $0.7170 after buyers emerged around $0.7150, while the kiwi was little changed at $0.5916 overnight. Resistance for the Aussie sits at $0.7208 and $0.7277, according to the report.

Global bond markets slid, with Treasuries leading the decline amid worries over the size of US government borrowing. Australian 10-year yields climbed to a five-month high of 5.166%, while three-year futures fell to 95.280 as traders priced in rates staying elevated for longer to curb inflation.

Markets now price a 54% chance that the Reserve Bank of Australia lifts its cash rate by a quarter point to 4.60% on September 29, up from 10% a week earlier. Weaker net exports and government spending point to a slowdown in the second quarter. Analysts expect GDP to rise just 0.3% in the quarter, with annual growth easing to 1.8% from 2.5%, and the main report is due Wednesday. Meanwhile, New Zealand's central bank is widely expected to raise its official cash rate to 2.75% on Wednesday, though guidance on later hikes is less clear.