New Zealand bond yields slump at close on downbeat risk sentiments ahead of fourth-quarter consumer inflation data

New Zealand government bonds jumped at the time of closing Wednesday as investors clustered safe-haven assets on ongoing global tensions; also, investors are now awaiting the country’s fourth-quarter consumer inflation data, scheduled to be released today by 21:45GMT for further direction in the debt market.

At the time of closing, the yield on the benchmark 10-year Treasury note, which moves inversely to its price, slumped 4-1/2 basis points to 2.95 percent, the yield on 20-year plunged 4 basis points to 3.43 percent and the yield on short-term 2-year ended 1 basis point lower at 2.04 percent.

US President Donald Trump this week slapped steep import tariffs on washing machines and solar panels, a move that stirred fears in Asia of more protectionist measures coming out of Washington. The kiwi faces a domestic hurdle on Thursday with the release of consumer price figures for the fourth quarter.

Median forecasts are for a 0.4 percent rise in consumer prices for the December quarter, leaving annual inflation running at a tame 1.9 percent. Anything softer would only reinforce expectations the Reserve Bank of New Zealand (RBNZ) will not be hiking rates for many more months to come.

Meanwhile, the NZX 50 index closed 0.20 percent higher at 8,324.09, while at 06:00GMT, the FxWirePro's Hourly NZD Strength Index remained neutral at 46.17 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex

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