The Australian and New Zealand dollars were left to drift on Wednesday as investors blew hot and cold on the global outlook while local data was solid but merely presaged the coming of the coronavirus lockdowns.
The Aussie was idling at $0.6435 AUD=D3 , corralled between support at $0.6373 and resistance around $0.6476. The major barrier lies at the recent seven-week top of $0.6570, which looks a stretch in the near-term given the currency rallied more than 6% over April.
The kiwi dollar was also listless at $0.6052 NZD=D3 , after a couple of very tight sessions. Support lies at $0.6010 and resistance at the recent high of $0.6176.
Normally important economic data had scant impact as they covered the first quarter of the year and thus missed much of the damage done by social distancing and business closures.
Australian retail sales did jump by a record 8.5% in March as consumers stockpiled food and basic staples, but much of the gain turned out to be from higher prices so limiting the boost to economic growth.
"It will likely also be offset by a collapse in spending on services, new car sales and a rundown in retail stocks," said NAB economist Kaixin Owyong.
She expects economic output shrank by 0.3% in the first quarter, ahead of a sharp 7% fall in Q2.
The Australian government is talking of reopening the economy in stages over the next three months, which should lead to some improvement in the second half of the year.
Bond futures were a little lower for the day but well within recent snug ranges. The three-year bond contract YTTc1 was off 2 ticks at 99.740, implying an yield of 0.26%.
Over in New Zealand, the unemployment rate edged up to a below-forecast 4.2% in the first quarter while jobs grew a faster-than-expected 0.7%.
But again this data largely preceded the coronavirus lockdowns.
"Looking ahead, the labour market will deteriorate, it already is," said Kiwibank senior economist Jeremy Couchman. "The unemployment rate is set to soar, and we think that it will peak around 9.5-10.5% by the end of this year."
He noted the government would deliver its budget next week, which could include more stimulus, while the Reserve Bank of New Zealand (RBNZ) policy announcement on May 13 might see an increase in its asset purchases.
