Summary:
Australia’s 10-year government bond yield rose to around 4.44%, mirroring an upward shift in U.S. bond yields, as the Federal Reserve indicated no rush to cut interest rates. Domestic yields were also supported by hawkish signals from the Reserve Bank of Australia.
Earlier this week, RBA Assistant Governor Sarah Hunter noted that the central bank remained more cautious than markets about further rate cuts, after its first reduction in over four years last month. She also emphasized the need to monitor U.S. policy decisions and their potential impact on Australian inflation. Market opinions on the timing of the next policy easing remain divided, with some analysts anticipating a move as early as May, while others project a cut in July or August.
The next RBA Board meeting and Official Cash Rate announcement will be on the 1st April 2025. As at the 21st of March, the ASX 30 Day Interbank Cash Rate Futures April 2025 contract was trading at 95.935, indicating a 10% expectation of an interest rate decrease to 3.85% at the next RBA Board meeting.
| TERM TO MATURITY | CLOSING RATE | WEEK | MONTH |
|---|---|---|---|
| 1 month | 4.0931 | 0.0027 | 0.0006 |
| 3 months | 4.1211 | 0.0084 | -0.0076 |
| 6 months | 4.2577 | 0.0475 | 0.0145 |
| TERM TO MATURITY | CLOSING RATE | Δ WEEK | Δ MONTH |
|---|---|---|---|
| 1 year | 3.7931 | -0.0509 | -0.1265 |
| 3 years | 3.6763 | 0.0393 | -0.1637 |
| 5 years | 3.9819 | 0.0389 | -0.1487 |
| 10 years | 4.32 | 0.039 | -0.1225 |
| 15 years | 4.4962 | 0.0392 | -0.1163 |