New Zealand bonds sharply rally at close on safe-haven demand in muted trading

The New Zealand bonds rallied sharply at the time of closing Thursday as investors poured into safe-haven assets amid ongoing global political disturbances and as investors remained muted in a silent trading session that witnessed data of little economic significance.

At the time of closing, the yield on the benchmark 10-year bond, which moves inversely to its price, plunged 5 basis points to 2.98 percent, the yield on 7-year note slumped 4-1/2 basis points to 2.81 percent and the yield on short-term 2-year note also ended 4 basis points lower at 2.07 percent.

The ANZ Commodity Price Index slipped 0.8% m/m in July, but international prices remain 21% higher than July last year. Movements at the sub-category level were mixed. Eight of the sub-components rose, six fell and the remaining three were unchanged. The strong NZD/USD weighed further with local returns down 2.1% m/m, but they are still 18% higher than 12 months’ prior.

Meanwhile, the New Zealand’s benchmark S&P/NZX 50 Index ended 0.07 percent higher at  7,753.75 while at 06:00GMT, the FxWirePro's Hourly NZD Strength Index remained highly bearish at -157.05 (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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