* Aussie hits 3-yr lows vs euro, 5-yr trough vs kiwi
* Stronger-than-expected jobs data no help to Aussie
* RBNZ signals rate rises in H1 2014
By Naomi Tajitsu and Cecile Lefort
SYDNEY/WELLINGTON, Dec 12 The Australian dollar
extended overnight losses on Thursday even as a jobs report beat
forecasts, while the New Zealand dollar bounced off lows
following a hawkish statement by the Reserve Bank of New
The Aussie slipped to $0.9037, from $0.9066 in
early trade, having lost more than a full cent in 24 hours.
It was briefly squeezed higher to a session peak of $0.9083
after data showed Australian employment increased by 21,000 in
November to handily beat expectations as more full- and
part-time positions were created.
But the Aussie quickly faded as the market returned to its
selling mood as expectations grew the Federal Reserve could
scale back stimulus as early as next week.
"The AUD perked up on the (jobs) headlines but reversed all
gains an hour later as the labour market overall still remains
sluggish," said Annette Beacher, head of Asia-Pacific FX
research at TD Securities in Singapore.
Not helping commodity currencies was the decision of U.S.
carmaker GM to pull out of Australia due to high
production costs and the strong Aussie dollar. The move was seen
as adding pressure to the central bank's plan to rebalance a
slowing economy away from a cooling mining sector.
All these factors resulted in the Aussie pulling closer to a
three-month low of $0.8989 touched last week. A break below
would target $0.8848, this year's trough.
Interbank futures eased and the market priced in a
slightly reduced chance of another cut in interest rates, which
has been an outside bet for some time.
They are giving a one-in-three chance of an easing by April.
The euro advanced further to top a three-year peak of
A$1.5279, showing a gain of 1.5 percent so far this
week. The Aussie skidded to its lowest in two years against the
safe-haven Swissie, while its sharpest fall was
against the kiwi.
The Aussie dropped just below NZ$1.0900, for the
first time since 2008, after the Reserve Bank of New Zealand
reiterated that interest rates would likely rise next year.
The kiwi rose as high as $0.8282 in early trade,
trimming losses after it fell to around $0.8203 offshore.
"The Reserve bank was more on the hawkish side than the
dovish side ... and they didn't say too much about the currency,
so that's what drove the kiwi up," said Tim Kelleher, head of
institutional FX sales at ASB.
Analysts said that while ongoing currency strength would be
an impediment to a hike as early as January, the RBNZ was
unlikely to hold off for too long.
"The RBNZ is still frustrated by the high exchange rate --
which was not 'sustainable in the long run' -- but was far less
explicit about it providing flexibility for monetary policy,"
analysts at Barclays Capital said in a note.
New Zealand bank bills fell as investors priced in
the possibility of more rate rises on a 12 month horizon.
Government bonds slipped, pushing yields 5 basis
points higher along the curve.
Australian government bond futures edged up, pulling away
from recent lows. The three-year bond contract gained 3
ticks to 96.965, while the 10-year contract added 1.5
ticks to 95.735, having plumbed a two-year through this week.