Australia’s 10-year government bond yield fell below 4.2%, retreating sharply from over nine-year highs and tracking US Treasury yields lower as softer-than-expected US PMI data countered bets that the Federal Reserve would raise interest rates further. Recent data also showed that Australia’s unemployment rate rose to a three-month high of 3.7% in July, exceeding forecasts for a milder uptick to 3.6%. On the monetary policy front, the Reserve Bank of Australia kept its policy rate unchanged at 4.1% during its August meeting, defying market expectations for a 25 basis point rate hike, as the board wanted more time to assess the impact of previous hikes on the economy. However, minutes of the RBA’s meeting showed that the central bank extended its inflation target timeline, signaling that it could keep monetary policy restrictive for some time.
Historically, the Australia Government Bond 10Y reached an all time high of 16.50 in August of 1982. Australia Government Bond 10Y - data, forecasts, historical chart - was last updated on August of 2023.
The Australia Government Bond 10Y is expected to trade at 4.25 percent by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate it to trade at 4.60 in 12 months time.