Australia, NZ currencies hit one-month lows on yen, subdued against US dollar -March 10, 2024 at 09:58 pm EDT

SYDNEY, March 11 (Reuters) – The Australian and New
Zealand dollars hit one-month lows on the yen on Monday as the
case strengthens for the Bank of Japan to end negative rates as
soon as next week, while investors await a key U.S. inflation
report that could sway June rate cut bets.

The Aussie fell 0.3% to 97.15 yen, the lowest
since mid-February, while the kiwi slipped 0.2% to
90.60 yen, the weakest level since early February.

With all of the action in yen thanks to data showing an
upward revision to Japan’s economy, the Antipodean currencies
were subdued against the dollar after hefty gains last week.

The Aussie was little changed at $0.6620, having
jumped 1.5% last week, its biggest weekly gain this year. It had
a volatile reaction to a mixed U.S. jobs report on Friday, which
had sent the currency to as high as $0.6667 before ending the
day little changed.

The kiwi was hovering at $0.6176, after rising 1.1%
last week to as high as $0.6217. It faces resistance at the
February high of $0.6218, while support is around the 200-day
moving average of $0.6078.

The Australian and New Zealand dollars had been pressured
since the start of the year, but they caught some breath this
month as risk assets rallied on growing confidence the Federal
Reserve is on track to cut interest rates in June, with
commentary from Chair Jerome Powell last week and U.S. jobs data
supporting the view.

“It has put an end to the dollar’s strong start to 2024, and
suggests to us that the greenback will remain on the back foot
in the near term,” Capital Economics analysts said.

“However, we continue to think a sustained period of dollar
weakness is unlikely, given the U.S. economy still looks in
considerably better shape than other major economies.”

Much will be riding on the U.S. consumer inflation report on
Tuesday.

Down Under, both Westpac and National Australia Bank will
publish their monthly consumer sentiment and business surveys on
Tuesday.

Reflecting the prospects of near-term global rate cuts,
Australian bond yields hit the lowest in more than a month. The
three-year yield slipped 3 basis points (bps) to
3.599%, after falling 9 bps the previous week.

Ten-year yields also fell 3 bps to 3.970%,
having dropped 15 bps last week.
(Reporting by Stella Qiu; Editing by Jamie Freed)