| Close | Previous Close | Change | |
|---|---|---|---|
| Australia 3-year bond* (%) | 3.93 | 3.91 | 0.02 |
| Australia 10-year bond* (%) | 4.51 | 4.50 | 0.01 |
| Australia 20-year bond* (%) | 4.90 | 4.89 | 0.01 |
| United States 2-year bond (%) | 4.30 | 4.24 | 0.06 |
| United States 10-year bond (%) | 4.69 | 4.62 | 0.07 |
| United States 30-year bond (%) | 4.92 | 4.85 | 0.07 |
* Implied yields from March 2025 futures. As at 7 January.
LOCAL MARKETS
Australian Commonwealth Government bond yields rose modestly across the curve. Economic reports of note released on the day were limited to November dwelling approval figures.
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 solid chance of a 25bp cut at the meeting. December futures implied 3.63%, 71bps below the current cash rate, thus inferring two 25bp cuts and a high probability of a third one between now and next December.
US MARKETS
US Treasury bond yields rose almost uniformly across the curve. Notable economic reports released on the day included November JOLTS figures, November trade balances and the ISM’s December non-manufacturing PMI.
The next FOMC meeting ends on 29 January. February federal funds futures implied an average cash rate of 4.315% for the month and thus a small probability of a 25bp cut at the meeting. December contracts implied 3.965%, 37bps less than the current federal funds effective rate.
