Australia 10-Year Bond Yield Hovers Around 3.6%

The Australian 10-year government bond yield bottomed around 3.6%, hovering close to levels not seen since mid-August, as less aggressive tightening by the Reserve Bank of Australia brought some respite to bond investors.

The Reserve Bank of Australia raised the cash rate 25 bps to 2.85% in November, becoming one of the first banks in developed economies to moderate the pace of tightening amid a deteriorating outlook for growth, with policymakers noting that rates had already risen substantially.

Still, the central bank mentioned that the tightening cycle was not over yet as inflation in Australia remains far higher than the RBA's target range of 2-3%.