** Shares of New Zealand-based airport operator Auckland Airport AIA.NZ fall as much 1.1% to NZ$8

** AIA reports softer traffic update for March, with passenger movements down 3% YoY

** Citi points out that weaker international capacity and transit passengers, along with flat domestic capacity, are the key drivers behind the performance

** However, the brokerage believes AIA's medium-term outlook remains intact, with an expected 10%+ p.a. EBITDA growth driven by committed capex

** The growth outlook may be improving with rate cuts in NZ likely driving a recovery in 2HCY25 and CY2026 - Citi

** Maintains "buy" rating at a target price of NZ$9.80

** Stock down 7.6%, YTD

(Reporting by Kumar Tanishk in Bengaluru)

((Tanishk.Kumar@thomsonreuters.com; X: @thatstanishk;))