| Close | Previous Close | Change | |
|---|---|---|---|
| Australian 3-year bond (%) | 3.469 | 3.467 | 0.002 |
| Australian 10-year bond (%) | 4.383 | 4.377 | 0.006 |
| Australian 30-year bond (%) | 5.067 | 5.05 | 0.017 |
| United States 2-year bond (%) | 3.959 | 3.898 | 0.061 |
| United States 10-year bond (%) | 4.489 | 4.427 | 0.062 |
| United States 30-year bond (%) | 5.018 | 4.973 | 0.045 |
Overview of the Australian Bond Market
Australian government bond yields rose on Tuesday, July 15, 2025, with the 10-year yield up 6 basis points to 4.43% and the 15-year yield increasing 7 basis points to 4.78%. The 2-year yield ticked up 5 basis points to 3.47%, reflecting a cautious market response to yesterday’s US CPI data and Trump’s tariff threats.
The RBA’s recent hold at 3.85% on July 8-9, despite earlier cut expectations, has shifted focus to August, with markets now pricing around 75-100 basis points of cuts over the next year, targeting a cash rate near 2.85%-3.10% by mid-2026, pending further inflation data. The Australian dollar’s 0.15% gain to 0.6554 supports this outlook, though tariff risks loom. Prime Minister Albanese’s China visit adds a wildcard, potentially easing trade tensions, but bond yields remain sensitive to global cues.
Overview of the US Bond Market
US Treasury yields climbed on Tuesday, July 15, 2025, with the 10-year note rising 8 basis points to 4.48%, reflecting inflation concerns after yesterday’s CPI data showed a 2.7% year-over-year rise. The 2-year yield dipped 1 basis point to 3.94%, while the 30-year yield jumped 13 basis points to 5.02%, steepening the yield curve amid tariff uncertainty.
Markets have dialed back July rate cut odds, now favoring September, with two cuts fully priced by year-end. The US also proposed easing bank capital requirements, allowing larger lenders to free up capital—potentially for Treasury purchases—though the move’s impact is under scrutiny. Bond market volatility persists as traders weigh inflationary risks against growth prospects.
