WELLINGTON/SYDNEY, March 14 (Reuters) - The Australian and New Zealand dollars were on the defensive against the yen early on Monday on expectations that a massive earthquake and tsunami in Japan will prompt repatriation of funds back to the country.
* The Australian dollar slumped to a near three-week low of 81.91 yen after the tremor hit before gradually recouping most losses to trade at 82.76 in early trade.
* The NZ dollar nosedived to a six-month low of 60.26 yen, before bouncing back to 60.62. It was trading at 61.12 yen before the quake struck.
* Traders say exporters are likely to treat any dips below 60 yen with caution until Japanese customer positions are better understood, with the kiwi/yen pair expected to trade between 59.80/61.50 yen range.
* The yen has soared broadly on safety bid after a 8.9 magnitude earthquake hit Japan on Friday with more than 10,000 feared dead. The currency could rise further if insurers scramble to raise cash by selling their foreign assets. US dollar/yen hovers around 81.86 yen early.
* Both the Aussie and the kiwi higher against the US dollar, benefiting from the retreating dollar/yen, with short-covering also pushing the currencies up.
* Aussie around $1.0144, after shedding nearly two cents to $0.9969 after the disaster in Japan. It is seen supported at $0.9966 with resistance at $1.0189.
* The NZ dollar fared better at $0.7428, having bounced from a near six-month low of $0.7322 last week. Kiwi seen capped at $0.7482 for now, with support at $0.7327.
* Euro received a fillip following an agreement by EU leaders to bolder a bailout fund.
* Wall Street higher, but oil prices fell. The CRB commodity index dipped 0.7 percent, while copper prices steady and gold prices firm.
* Kiwi has outperformed the Aussie which has seen the cross rate backtrack to NZ$1.3635, from last week's 19-year peak of NZ$1.3794.
* The Reserve Bank of NZ's slashing of its benchmark rate by 50 basis points to 2.5 percent as a one-off emergency measure after the Christchurch earthquake, has cleared the air and leaves further rate action off the agenda.
* The Reserve Bank of Australia (RBA) still more likely to be the first to raise rates, though markets imply little chance of a move until the third quarter.
* NZ government bonds firmer, while U.S. Treasury debt prices dropped on fears that Japanese insurers may need to sell bonds to pay for damages.
* Australian bond futures rise with the three-year contract up 0.047 points to 95.02 and the 10-year contract up 0.02 points to 94.530.
(Australia/New Zealand bureaux) Keywords: MARKETS AUSTRALIA NEWZEALAND FOREX/BONDS (+61 2 9373 1800/+64 4 471 4234) COPYRIGHT Copyright Thomson Reuters 2011. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
* The Australian dollar slumped to a near three-week low of 81.91 yen after the tremor hit before gradually recouping most losses to trade at 82.76 in early trade.
* The NZ dollar nosedived to a six-month low of 60.26 yen, before bouncing back to 60.62. It was trading at 61.12 yen before the quake struck.
* Traders say exporters are likely to treat any dips below 60 yen with caution until Japanese customer positions are better understood, with the kiwi/yen pair expected to trade between 59.80/61.50 yen range.
* The yen has soared broadly on safety bid after a 8.9 magnitude earthquake hit Japan on Friday with more than 10,000 feared dead. The currency could rise further if insurers scramble to raise cash by selling their foreign assets. US dollar/yen hovers around 81.86 yen early.
* Both the Aussie and the kiwi higher against the US dollar, benefiting from the retreating dollar/yen, with short-covering also pushing the currencies up.
* Aussie around $1.0144, after shedding nearly two cents to $0.9969 after the disaster in Japan. It is seen supported at $0.9966 with resistance at $1.0189.
* The NZ dollar fared better at $0.7428, having bounced from a near six-month low of $0.7322 last week. Kiwi seen capped at $0.7482 for now, with support at $0.7327.
* Euro received a fillip following an agreement by EU leaders to bolder a bailout fund.
* Wall Street higher, but oil prices fell. The CRB commodity index dipped 0.7 percent, while copper prices steady and gold prices firm.
* Kiwi has outperformed the Aussie which has seen the cross rate backtrack to NZ$1.3635, from last week's 19-year peak of NZ$1.3794.
* The Reserve Bank of NZ's slashing of its benchmark rate by 50 basis points to 2.5 percent as a one-off emergency measure after the Christchurch earthquake, has cleared the air and leaves further rate action off the agenda.
* The Reserve Bank of Australia (RBA) still more likely to be the first to raise rates, though markets imply little chance of a move until the third quarter.
* NZ government bonds firmer, while U.S. Treasury debt prices dropped on fears that Japanese insurers may need to sell bonds to pay for damages.
* Australian bond futures rise with the three-year contract up 0.047 points to 95.02 and the 10-year contract up 0.02 points to 94.530.
(Australia/New Zealand bureaux) Keywords: MARKETS AUSTRALIA NEWZEALAND FOREX/BONDS (+61 2 9373 1800/+64 4 471 4234) COPYRIGHT Copyright Thomson Reuters 2011. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.