| Close | Previous Close | Change | |
|---|---|---|---|
| Australia 3-year bond* (%) | 4.13 | 4.11 | 0.02 |
| Australia 10-year bond* (%) | 4.44 | 4.42 | 0.02 |
| Australia 20-year bond* (%) | 4.76 | 4.74 | 0.02 |
| United States 2-year bond (%) | 4.71 | 4.74 | -0.03 |
| United States 10-year bond (%) | 4.35 | 4.44 | -0.09 |
| United States 30-year bond (%) | 4.52 | 4.61 | -0.09 |
* Implied yields from September 2024 futures. As at 3 July.
LOCAL MARKETS
Australian Commonwealth Government bond yields moved modestly higher across the curve, in contrast with the falls of US yields on Tuesday night. Economic reports included May dwelling approvals and May retail sales figures.
The next RBA Board meeting ends 6 August. August futures imply an average cash rate of 4.40% for the month, thus pricing some chance of a 25bp rate rise at the meeting. June 2025 futures imply 4.335%, just above the current cash rate, thus pricing in a zero probability of a 25bp cut (in net terms) between now and next June.
US MARKETS
Short-term US Treasury bond yields fell modestly while longer-term yields fell more materially. Data releases included the June ISM non-manufacturing PMI, May factory orders, the May trade balance, weekly initial jobless claims and the minutes of the Fed June meeting.
The next FOMC meeting ends on 31 July. August federal funds futures implied an average cash rate of 5.305% for the month and thus a small chance of a 25bp rate cut at the meeting. However, June 2025 contracts implied 4.365%, 97bps less than the current rate.
