The Australian dollar eased on Wednesday after fourth-quarter data showed construction spending unexpectedly fell, adding to evidence of slowing domestic economic momentum while New Zealand's currency hovered near a 2-1/2 week peak. The Aussie slipped 0.1 percent to $0.7180 as official figures showed the value of construction work done slumped 3.1 percent in the December quarter, confounding expectations for a 0.4 percent rise.

This marked the second straight quarter of sharp falls and challenges the Reserve Bank of Australia's (RBA) dogged optimism growth will pick up this year. "Australia's construction activity...will be a drag on gross domestic product (GDP) growth," ANZ said in a note.

Across the Tasman Sea, the New Zealand dollar took a breather near a 2-1/2 week peak at $0.6889 after three straight sessions of gains. The currency had rallied on signs of progress in the protracted Sino-US trade dispute which is seen as a positive for world trade and commodity prices.

Major chart resistance for the kiwi is seen around $0.6942, with immediate support at $0.6864. New Zealand government bonds eased, sending yields higher across the long-end of the curve. Australian government bond futures gained, with the three-year bond contract and the 10-year contract rising 2.5 ticks each to 98.365 and 07.935 respectively.

Copyright Reuters, 2019