The discussion on pushing forward the next stage of trade talks came as a welcome salve after the arrest of a top executive at Chinese telecoms giant Huawei Technologies had threatened to scupper the process. The glimmer of hope was enough to lift the Aussie dollar up to $0.7200 and off a four-week low of $0.7170.
Resistance was still lined up at $0.7227, with major chart support at $0.7164 where a breach would open the way for a retreat back toward the $0.7020/50 zone. The kiwi dollar edged ahead to $0.6882, having found solid support around $0.6840. It faces resistance at $0.6904. The pound also lost ground on the Aussie to hit A$1.7443, having fallen 1.2 percent overnight. All this tumult kept Australia's top-rated sovereign bonds well supported. Yields on 10-year paper held at 2.445 percent and near the lowest since June 2017, having fallen 40 basis points in just the past month. Futures were a whisker off their highs, with the three-year bond contract down one tick at 98.055. The 10-year contract eased 0.75 ticks to 97.5475. Yields on New Zealand 10-year paper were just above their lowest since late 2016 at 2.46 per cent.