| Close | Previous Close | Change | |
|---|---|---|---|
| Australia 3-year bond* (%) | 3.31 | 3.64 | -0.33 |
| Australia 10-year bond* (%) | 3.87 | 4.06 | -0.19 |
| Australia 20-year bond* (%) | 4.46 | 4.46 | 0.00 |
| United States 2-year bond (%) | 3.92 | 3.88 | 0.04 |
| United States 10-year bond (%) | 3.79 | 3.79 | 0.00 |
| United States 30-year bond (%) | 4.08 | 4.11 | -0.03 |
* Implied yields from September 2024 futures. As at 5 August.
LOCAL MARKETS
Australian Commonwealth Government bond yields plunged, although ultra-long yields remained steady with a likely catch up coming tomorrow. Domestic data releases were limited to the July update of the Melbourne Institute’s Inflation Gauge.
The August RBA Board meeting ends today. August futures implied an average cash rate of 4.30% for the month, thus pricing in a small chance of a 25bp cut at the meeting. July 2025 futures implied 3.40%, 94bps below the current cash rate, thus pricing in three 25bp cuts and a high chance of a fourth one between now and next July.
US MARKETS
US Treasury bond yields rose moderately at the short end while ultra-long yields declined. Data releases included July ISM non–manufacturing PMIs and the Fed July Senior Loan Officer Opinion survey.
The next FOMC meeting ends on 18 September. September federal funds futures implied an average cash rate of 5.075% for the month and thus a 100% probability of at least a 25bp rate cut at the meeting. July 2025 contracts implied 3.38%, 195bps less than the current rate.
