The Australian and New Zealand dollars held their ground on Wednesday as a rebound in global equities pointed to some improvement in risk appetite after a rough couple of weeks.
The Aussie dollar AUD=D3 edged up to $0.7136 but again had no luck breaching stiff resistance around $0.7150. Support comes in at Monday's low of $0.7099.
The kiwi had a little more luck to reach $0.6592 NZD=3 and challenge resistance at $0.6600.
It had rallied 0.5 percent on Tuesday after surprisingly strong domestic inflation data led investors to lengthen the odds on a cut in interest rates.
"Risk sentiment has improved this week and the U.S. dollar has weakened slightly," said Westpac's head of NZ market strategy Imre Speizer.
"Add to that the inflation surprise plus extreme short positioning in the kiwi and it's supportive of a corrective rebound to $0.6700 during the week ahead."
Sentiment got a shot in the arm as a bevy of upbeat U.S. earnings results boosted Wall Street and eased concerns a rout in global equities would threaten economic growth and commodity prices.
There were no local data out on Wednesday, though Reserve Bank of Australia (RBA) Deputy Governor Guy Debelle used a speech to reiterate the central bank's optimism that wages would eventually rise as the job market tightened.
He acknowledged, however, that recent experience abroad suggested the unemployment rate might need to fall a lot further than in the past to really stoke wages.
Subdued wages growth is a major reason inflation has undershot the RBA's 2 to 3 percent target band in the last couple of years and why interest rates are stuck at record lows of 1.5 percent.
Australian government bond futures were a fraction firmer, with the three-year bond contract YTTc1 up 1 tick at 97.895. The 10-year contract YTCc1 added half a tick to 97.2800.
New Zealand government bonds
0#NZTSY= steadied after slipping on Tuesday.
