SYDNEY, March 4 (Reuters) - The Australian dollar held tight ranges on Monday as data raised the risk of a negative print in the economic growth last quarter, while traders braced for the release of China's new economic targets and policy stimulus for this year.
The Aussie was flat at $0.6525 AUD=D3 , having rebounded 0.4% on Friday as soft U.S. data added to the bets of a June rate cut. It, however, still ended last week 0.6% lower, with support at around $0.6488.
The kiwi dollar slipped 0.2% to 0.6098 NZD=D3 , after tumbling 1.5% last week before finding support at its 200-day moving average of $0.6076. It was still suffering fallout from the Reserve Bank of New Zealand's decision to trim its projected peak for rates, which led markets to price out any risk of a further rate hike.
0#RBNZWATCH Data on Monday showed business inventories in Australia fell 1.7% in the fourth quarter, meaning they likely subtracted 1.0% from the economic growth. Analysts had looked for a modest expansion of 0.2% in the quarter but the weak inventories raised the risk of an outright contraction in the economy.
"That is a larger detraction from growth than we had been anticipating," said Stephen Wu, a senior economist at the Commonwealth Bank of Australia. "However, there is likely to be some offset from the public and farm sectors."
Wednesday's GDP report will be closely watched by markets to determine the timing of a first rate cut from the Reserve Bank of Australia this year. The total easing so far priced in has been modest and the first reduction is expected only in September.
0#RBATCH Another key risk this week for the two antipodeans is China's annual parliament meeting on Tuesday when authorities will flag new stimulus measures and set the GDP goal.
"Markets are hopeful that Beijing will announce a promising GDP growth target and a much more expansionary fiscal spending plan," said analysts at Nomura.
"While we do expect Beijing to announce a larger fiscal deficit, we are concerned that China may have to struggle with another year of overall fiscal contraction, thanks to the faltering property sector and Beijing's efforts to rein in irresponsible local government spending."
