SYDNEY, May 13 (Reuters) - The Australian and New Zealand dollars held firm on Wednesday as global markets inched higher in the absence of new developments in the Middle East, while wagers on Aussie rate hikes were untroubled by the government's annual budget.

The Aussie steadied at $0.7243 AUD=D3, having found solid support around $0.7200 overnight for the fourth session running. More support lies at $0.7136 and $0.7103, with resistance at the recent four-year high of $0.7277.

The kiwi dollar was a whisker firmer at $0.5961 NZD=D3, as support around $0.5930 continues to hold. A break of $0.5991 would target $0.6012 and $0.6076.

The Australian government's 2026/27 budget projected modestly smaller deficits ahead, proposed some big changes to housing tax policies, but mostly left it up to the Reserve Bank of Australia to fight rising inflation.

"Greater spending restraint in 2026-27 would have reduced aggregate demand across the economy and created more headroom for the RBA if inflation stays high," argued Luke Yeaman, chief economist at CBA. "As it stands, the risk sits with further tightening by the RBA."

Markets still imply around a 20% chance of a June hike to the 4.35% cash rate, but the probability of an August hike to 4.60% nudged further above 80%. 0#AUDIRPR

Yields on Australian 10-year notes AU10YT=RR climbed 5 basis points to 5.085%, though that was almost entirely driven by a rise in U.S. Treasury yields, leaving spreads little changed.

On the positive side, the government's bond issuance plans for 2026/27 surprised on the downside at A$125 billion, only marginally higher than the current fiscal year and far less than what the U.S. is borrowing just this week.

"Australia's public debt is low by international standards and supports our triple-A sovereign rating," noted analysts at S&P Global Ratings.

"Nevertheless, central government gross debt will cross the A$1 trillion mark within the next few months, sharpening political focus on the national balance sheet."

Domestic economic data out on Wednesday had scant impact, with wages rising 0.8% as expected in the first quarter, while the annual pace dipped back to a benign 3.3%.

Growth in the private sector slowed to its lowest level in almost 4 years, but the RBA is more focused on broader measures of labour costs, which remain elevated.