By Wayne Cole

SYDNEY, June 29 (Reuters) - The Australian and New Zealand dollars faced another tough week on Monday as markets wager on an early U.S. rate hike, while paring back expectations for tightening at home.

The Aussie was flat at $0.6888 AUD=D3, having shed 1.8% last week to three-month lows at $0.6875. The next major bulwark is a trough from March at $0.6834 and a break would risk a retreat to an old trading range of $0.6660 to $0.6766.

The kiwi dollar hovered around $0.5643 NZD=D3, after also losing 1.8% last week to a seven-month low of $0.5627. Support now lies at $0.5581 and $0.5485, with resistance at $0.5681.

The greenback has been on a roll since the Federal Reserve took a hawkish swerve this month and led markets to price in a 75% chance of a rate rise as early as September.

Domestic economic data is thin on the ground, though the latest figures on home prices will be in focus on Wednesday.

Prices have been squeezed since February by three hikes in interest rates, and took an added blow last month when the government announced tax changes that would make investing in established property less attractive.

A sustained pullback in the turnover of housing combined with falling values could chip away at household wealth and spending. That would actually be welcomed by the Reserve Bank of Australia given it is fighting hard to slow the economy and restrain inflation.

The recent retreat in oil has led investors to pare the risk of another rate rise to just 40%, and to flirt with the idea of cuts as early as mid-2027. 0#AUDIRPR

Minutes of the RBA's June meeting are due on Tuesday and should offer more detail on the board's decision to hold rates steady at 4.35%.

The Reserve Bank of New Zealand meets next week and markets imply around a two-in-three chance of a rise in the 2.25% cash rate given the bank's hawkish guidance. 0#NZDIRPR

"The world is in a very different place to when the Reserve Bank was publishing its last forecasts," argued Jarrod Kerr, chief economist at Kiwibank. "Oil prices are a lot lower and the market is expecting much lower prices out to the end of the decade."

"This gives us confidence that medium-term risk from tradeable inflation remains low," he added. "The Reserve Bank would be wise to hold rates rather than hike."