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Australia, NZ dollars left behind as easing expectations drag

* RBA holds Aussie rates at 0.25%, as expected

* Brief AUD bounce above 72c cannot hold as easing bias weighs

* Kiwi steady at $0.6649

SINGAPORE, Oct 6 (Reuters) - The Australian and New Zealand dollars crept higher against the greenback and yen on Tuesday, but lagged a broader rally in riskier assets on the prospect of further monetary easing.

The Australian dollar briefly flicked above 72 cents after the Reserve Bank of Australia left rates on hold, as expected. But gains were short-lived as the central bank made clear that further easing remained under consideration.

The Aussie was last at $0.7187, more or less where it began in the Asian session. The New Zealand dollar edged up 0.1% to $0.6649. Both currencies briefly hit a two-week high against the yen, with the Aussie climbing to 76.14 yen .

“Overall, the (RBA) statement doesn’t reek of urgency to act,” said Westpac FX strategist Sean Callow.

“It has mixed commentary about things could have been worse, and they are getting better, but we know they’re still bad,” he said, perhaps tempering bets that easing could come in November.

The RBA noted an improvement in the outlook for unemployment in Australia, and now expects a peak below the 10% level it had forecast in September, but still said it “continues to consider how additional monetary easing could support jobs.”

The Australian government is due to release its federal budget later in the day, where it is expected to boost spending to support jobs and stimulate growth.

The Antipodeans’ meagre gains have lagged a global rebound in risk assets as a selloff triggered late last week by Trump’s COVID-19 diagnosis unwound with an improvement in his condition.

Analyst said caution about the outlook - with plenty of uncertainty ahead from U.S. elections to wobbles in the economic rebound - capped optimism along with the firm easing bias of both the RBA and the Reserve Bank of New Zealand.

Bond markets tracked rising U.S. yields, but the anticipation of further RBA easing kept downward pressure on Australian yields at the short end.

“The easing bias is still very much there,” said Chris Weston, head of research at brokerage Pepperstone in Melbourne. “The market’s anticipating a lower yield-curve control target at some stage.”

The yield on New Zealand 10-year government bonds rose two basis points to 0.558%. Australian government bond futures dipped, with the 10-year contract down three ticks to 99.0950 while the three-year contract was steady at 99.775. (Reporting by Tom Westbrook in Singapore Editing by Shri Navaratnam)

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