NZ dollar hemmed in ahead of rate call; debt soft

WELLINGTON, Oct 28 - The New Zealand dollar traded a tight range near one-week lows on Wednesday ahead of a central bank decision expected to pave the way to eventual rate rises.

* Kiwi <NZD=D4> resumes local trade around $0.7430/40 as it remains pressured from combined effects of profit taking in high yielders, reduced risk appetite and wariness about forthcoming central bank rate decision.

* U.S. dollar touches a two-week high against the euro <EUR=> after its safe haven appeal is boosted by a report showing U.S. consumer confidence deteriorating sharply in October. See [ID:nN27236301]

* U.S. dollar's resilience also seen as due to a heavy short position on the currency accumulated the last few weeks, a sign that the greenback could rebound in the near term.

* NZ dollar briefly managed to attain $0.7500 level in early offshore trading before retreating back towards $0.7400 support levels.

* NZ monthly business confidence survey at due 0200 GMT and Australian third quarter inflation at 0030 GMT, with expectations of a 0.8 percent rise <ECONAU> in consumer prices on the previous quarter.

* Market attention on the Reserve Bank of New Zealand's (RBNZ) rate review on Thursday. Latest Reuters poll shows no change is seen to 2.5 percent cash rate with economists expecting the central bank to start hiking as early as March next year. [NZ/POLL] RBNZ as a minimum expected to drop reference to another possible rate cut, and may even dilute its pledge to keep rates at current level until latter part of 2010. See [ID:nWEL505681]

* NZ dollar seen supported at $0.7400/10 with initial resistance around $0.7490/00.

* NZ bonds open weaker across the curve as U.S. Treasuries gain on bargain hunting on strong demand in bond auction and safe haven appeal after weak U.S. consumer confidence data. -------------(28 October 2009 09:00 / 2000 GMT)----------------

(Last prices as at 6pm NZ time the previous day) 90-DAY LIVE 2.80 (2.77) NOV-2011 4.515 (4.465) 90-DAY (DEC) 97.10 (97.1) APR-2013 5.260 (5.240) 90-DAY (MAR) 96.60 (96.57) DEC-2017 5.810 (5.790) 90-DAY (JUN) 95.69 (95.66) MAY-2021 6.080 (6.060) RBNZ MCI 373 (400) US 10YR BOND 3.454 (3.395) NZD TWI 66.89 (67.30) AU 10YR BOND 5.695 (5.720) NZD/USD 0.7423(0.7536) NZ/US 10YR SPD +236bp(+240bp) NZD/AUD 0.8118(0.8143) NZ/AU 10YR SPD +11bp (+7bp) NZD/EUR 0.5019(0.5023) NZ 2YR SWAP 4.740 (4.690) NZD/JPY 68.23 (68.68) NZ 5YR SWAP 5.750 (5.650) --------------------------------------------------------------- - (