NZ dollar mixed on volatile Wall Street; bonds flat

WELLINGTON, Nov 3 - The New Zealand dollar <NZD=> was mixed in choppy trading on Tuesday as a volatile day on Wall Street kept investors cautious on riskier holdings such as the kiwi.

* Kiwi about $0.7164/67, compared with around $0.7209/16 in late local trade on Monday, with the currency bouncing between an offshore low of $0.7083 and a high of $0.7269.

* Kiwi recoups some early weakness as U.S. stocks push back into positive territory on solid manufacturing data. Wall Street briefly under pressure after critical comments on the financial sector from a Federal Reserve official caused investors to sell financial shares.

* U.S. dollar and yen weaker after U.S. data showed sharp improvements in manufacturing, construction and housing, reducing safe-haven demand for the U.S. and Japanese currencies.

* NZ dollar still trapped below the A$0.80 level against the Aussie <NZDAUD=R> ahead of the Reserve Bank of Australia's rate review on Tuesday when it is expected to raise rates by 25 basis points, further widening rate differentials with NZ. [AU/INT]

* Kiwi also weaker against the euro <NZDEUR=R> and the yen <NZDJPY=R>, keeping the trade-weighted <=NZD> 0.6 percent lower.

* Markets also edgy ahead of central bank meetings in Britain, eurozone and the United States, along with U.S. non-farm payrolls at the end of the week.

* Locally, third-quarter wages data due on Tuesday, with expectations that wages will rise just 0.3 percent in the three months to Sept. 30. Jobs data on Thursday is expected show the unemployment rate rising to 6.4 percent from 6 percent. [NZ/POLL]

* The NZ Treasury Dept. said on Monday in its monthly commentary on economic indicators that the pace of growth was likely to quicken in the second half. See [ID:nSYD352084]

* Kiwi seen as vulnerable after falling through support levels. Initial support seen around $0.7100 with resistance at $0.7270.

* NZ bonds a touch softer after U.S. Treasury debt prices weakened as stronger than expected U.S. manufacturing data dented demand for safe haven government debt. -------------(03 November 2009 09:11 / 2011 GMT)-------------

(Last prices as at 6pm NZ time the previous day) 90-DAY LIVE 2.79 (2.78) NOV-2011 4.268 (4.260) 90-DAY (DEC) untraded(97.16) APR-2013 5.049 (5.050) 90-DAY (MAR) 96.88 (96.88) DEC-2017 5.685 (5.680) 90-DAY (JUN) 96.08 (96.08) MAY-2021 5.985 (5.980) RBNZ MCI 194 (216) US 10YR BOND 3.424 (3.407) NZD TWI 64.57 (64.85) AU 10YR BOND 5.602 (5.597) NZD/USD 0.7158(0.7202) NZ/US 10YR SPD +226bp(+227bp) NZD/AUD 0.7935(0.7967) NZ/AU 10YR SPD +8bp (+8bp) NZD/EUR 0.4850(0.4878) NZ 2YR SWAP 4.470 (4.470) NZD/JPY 64.67 (64.85) NZ 5YR SWAP 5.620 (5.620) --------------------------------------------------------------- - (