Australia, NZ dlrs Recover from Bond Market Tumult

SYDNEY, March 1 Reuters The Australian and New Zealand dollars recovered against the greenback on Monday after riskier currencies plunged late last week amid a global bond market selloff.

The Aussie dollar was 0.69 higher at 0.7759, but still well bellow a threeyear high of 0.8007 hit on Feb. 25.

The Kiwi dollar was 0.66 higher at 0.7273 but off the 0.7464 level also hit on Feb. 25, which was its highest since August 2017.

The Australian and New Zealand currencies had been climbing in recent months due to a combination of buoyant commodity prices, as well as a recovery in their domestic economies and housing markets from the COVID19 crisis.

But optimism about a global economic recovery, buoyed by unprecedented fiscal and monetary stimulus, has fuelled concerns about inflation and monetary tightening, sending global bond yields rising and weighing on riskier currencies.

A number of Australias states have snapped back from last years lockdowndriven recession and are growing at an abovetrend pace… with the vaccination rollout now underway, the path to normalisation is looking more assured, said Richard Yetsenga, chief economist at ANZ.

Australian debt, tracking a selloff in global bond markets last week, also rebounded from some of the biggest price declines in years seen on Friday.

Yields on 10year Australian bonds eased 11 basis points to 1.64 after hitting 1.97 on Friday, the highest since May 2019 and up from under 1 in early January.

Despite rapidly…

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