09.12.202504:13:01UTC+00AUS 10Y Yield Rises to Over 2-Year High

Australia's government bond yield has climbed to approximately 4.75%, reaching its peak since November 2023. This rise follows the Reserve Bank of Australia's (RBA) decision to keep its benchmark interest rate unchanged for the third consecutive meeting. The RBA has indicated that any future policy adjustments will depend on forthcoming economic data. The decision to maintain the interest rate was unanimous, as policymakers highlighted renewed inflationary pressures and a persistently tight labor market. They also acknowledged that although recent data suggest increased inflation risks, further time is needed to evaluate the durability of these pressures. Current market sentiment reflects a near-even probability of an interest rate hike by May, whereas the majority of economists believe the easing cycle has concluded, despite prior expectations for at least one additional rate cut to 3.35%. All eyes are now on Thursday's labor market report, which is expected to provide further insight into the economy's underlying strength.