AUD Eases amid Disappointing Vaccine Rollout, NZD Unchanged

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SYDNEY, April 12 (Reuters) – The Australian dollar opened the week slightly lower on Monday, as investor mood soured following setbacks in the country’s vaccination programme, while the New Zealand dollar was little changed.

The Aussie dollar was down 0.15% at $0.7606, extending Friday’s losses, which were triggered by worries about a slowdown in the country’s coronavirus vaccine rollout.


The currency had consolidated around $0.7650 in recent weeks following a brief run-up to $0.80 earlier this year.


Australia has abandoned a goal to vaccinate nearly all of its 26 million population by the end of 2021 following advice that people under the age of 50 take Pfizer’s COVID-19 vaccine rather than AstraZeneca’s shot.


On top of the disappointing vaccine news, investors are also cautious in the wake of the expiration of the country’s wage subsidy program.


The Aussie “risks trading heavily this week in our view,” said Commonwealth Bank strategists in a note. “The combination of our outlook for a strong USD and delay in the vaccine rollout in Australia are headwinds.”


However, CBA expected the antipodean currency weakness to be short-lived.


The New Zealand dollar was little changed, having hovered around the $0.7031 level since April 2. The Kiwi’s major barrier is $0.7053, and support lies around $0.70.


New Zealand government bonds were little changed, with yields trading 2-3 basis points higher at the longer end of the curve.


Yields on Australian 10-year bonds were higher at 1.71%, but far from a top of 1.87% last month. They were trading at a 6 basis point yield spread over U.S. Treasuries, up from 3 basis points on Friday but far from the 40 basis point gap hit in February.


(Editing by Ana Nicolaci da Costa)


Source: Reuters

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