Australia, NZ dollars find some support, RBA sounds upbeat

By Wayne Cole

SYDNEY, Sept 22 (Reuters) - The Australian and New Zealand dollars managed to steady on Monday after last week's slide, with upbeat economic comments from a top central banker offering the Aussie some much-needed support.

Appearing before a house economics committee, Reserve Bank of Australia Governor Michele Bullock said the economy was in a good place with growth and inflation, suggesting there was no urgency to cut rates in the near term.

The central bank meets next week and markets imply only a 16% chance of a quarter-point rate cut, which rises to around a 70% probability of an easing at the following meeting on November 4. 0#AUDIRPR

Just one further cut to 3.10% is then expected, assuming the economy continues to pick up pace as it did in the second quarter, compared to another 100 basis points from the U.S. Federal Reserve.

The diverging outlook helped the Aussie hold at $0.6594 AUD=D3, having fallen 0.9% last week and away from an 11-month top of $0.6707. It now has support around $0.6580 and $0.6482.

The kiwi dollar was flat at $0.5852 NZD=D3, after shedding almost 1.7% last week in the wake of dismal economic data. Support lies at $0.5833 and $0.5800, with major resistance up at last week's high of $0.6007.

Investors are fully priced for a quarter-point cut to 2.75% from the Reserve Bank of New Zealand in October, with even a one-in-four chance of 50 basis points. 0#NZDIRPR

"It has become crystal clear that the Kiwi economy is not recovering," said Jarrod Kerr, chief economist at Kiwibank. "We now expect a 50bps cut in October, followed by a 25bps cut in November, and we need to have a serious discussion around a further move to 2%."

"We think there's about a 50/50 chance that the economy may require further support," he added. "We need the RBNZ’s foot firmly on the accelerator."