| Close | Previous Close | Change | |
|---|---|---|---|
| Australian 3-year bond (%) | 3.783 | 3.80 | -0.01 |
| Australian 10-year bond (%) | 4.42 | 4.45 | -0.03 |
| Australian 30-year bond (%) | 4.97 | 5.00 | -0.03 |
| United States 2-year bond (%) | 3.96 | 3.99 | -0.03 |
| United States 10-year bond (%) | 4.27 | 4.32 | -0.05 |
| United States 30-year bond (%) | 4.59 | 4.63 | -0.04 |
LOCAL MARKETS
Australia’s 10-year government bond yield fell to around 4.46% as fears of a US tariff-driven economic slump heightened risk aversion. Escalating global trade tensions, with countries imposing retaliatory measures against US tariffs, further eroded investor sentiment.
Domestically, traders remained focused on the RBA’s policy outlook after recent strong economic data tempered rate cut expectations. GDP growth exceeded forecasts, marking its first acceleration in over a year, while RBA minutes signalled caution, downplaying further easing.
In other news, Australian consumer sentiment hit a three-year high in March, boosted by the RBA’s February rate cut and easing cost-of-living pressures. However, business confidence turned negative in February.
USA Markets
The yield on the 10-year US Treasury note rose above the 4.34% threshold on Thursday, the highest in over two weeks, despite softer-than-expected inflation data as markets continued to assess the outlook of US growth and borrowing costs amid uncertain trade policy.
Both headline and core producer prices surprised on the downside in February, consistent with the slowdown for consumer prices, although selected sections of price baskets raised uncertainty on whether the disinflation momentum can be sustained.
Such uncertainty was magnified by disruptive tariffs and U-turns by President Trump that raised appeal for the safety of Treasury assets since the start of the month, although investors preferred the shorter end of the curve, driving the 2-year to significantly outperform the 10-year note. Rate derivatives continued to reflect that the market has positioned for three 25bps rate cuts by the Fed this year.
