| Close | Previous Close | Change | |
|---|---|---|---|
| Australia 3-year bond* (%) | 3.36 | 3.33 | 0.03 |
| Australia 10-year bond* (%) | 3.88 | 3.85 | 0.03 |
| Australia 20-year bond* (%) | 4.26 | 4.23 | 0.03 |
| United States 2-year bond (%) | 3.62 | 3.61 | 0.01 |
| United States 10-year bond (%) | 3.71 | 3.65 | 0.06 |
| United States 30-year bond (%) | 4.02 | 3.96 | 0.06 |
* Implied yields from December 2024 futures. As at 18 September.
LOCAL MARKETS
Australian Commonwealth Government bond yields moved moderately higher in a uniform manner across the curve. The only domestic data release of note on the day was the August reading of the Westpac-Melbourne Institute Leading Index.
The next RBA Board meeting ends on 24 September. September futures implied an average cash rate of 4.335% for the month, thus pricing in a near-zero probability of a 25bp cut at the meeting. August 2025 futures implied 3.315%, 103bps below the current cash rate, or at least four 25bp cuts between now and next August.
US MARKETS
Short-term US Treasury bond yields rose a little while longer-term yields increased noticeably on the day. Data releases included reports for August building permits and August housing starts. However, the reports were overshadowed by the FOMC’s announcement of a 50bps cut to its federal funds rate target range.
The next FOMC meeting ends on 7 November. November federal funds futures implied an average cash rate of 4.565% for the month and thus a 100% probability of at least a 25bp rate cut at the meeting. August 2025 contracts implied 3.00%, 183bps less than the current rate.
