| Close | Previous Close | Change | |
|---|---|---|---|
| Australia 3-year bond* (%) | 4.04 | 4.06 | -0.02 |
| Australia 10-year bond* (%) | 4.65 | 4.67 | -0.02 |
| Australia 20-year bond* (%) | 5.03 | 5.04 | -0.01 |
| United States 2-year bond (%) | 4.36 | 4.40 | -0.04 |
| United States 10-year bond (%) | 4.78 | 4.80 | -0.02 |
| United States 30-year bond (%) | 4.97 | 4.98 | -0.01 |
* Implied yields from March 2025 futures. As at 14 January.
LOCAL MARKETS
Australian Commonwealth Government bond yields declined modestly across the curve. Economic reports of note released on the day were limited to the Westpac-Melbourne Institute January Consumer Sentiment Index.
The next RBA Board meeting ends on 18 February 2025. February futures implied an average cash rate of 4.275% for the month, thus pricing in a good chance of a 25bp cut at the meeting. December futures implied 3.72%, 62bps below the current cash rate, thus inferring two 25bp cuts and some chance of a third one between now and next December.
US MARKETS
US Treasury bond yields declined across a slightly steeper curve. Notable economic reports released on the day included December PPI figures and the NFIB December Small Business Optimism Index.
The next FOMC meeting ends on 29 January. February federal funds futures implied an average cash rate of 4.325% for the month and thus a small probability of a 25bp rate cut at the meeting. December contracts implied 4.035%, 30bps less than the current federal funds effective rate.
