The inexorable march away from “Australia is different” continues. Over the weekend, Australian bond yields were positively hammered and sit this morning at record lows across the board:
The rampaging global bond bull market has taken Australian 2 year yields decisively below 2% for the first time, 5 year yields to the threshold of 2% for the first time, and 10 year yields to a full 10bps below the cash rate at 2.4%, another record low.
This gives you some idea of how far behind the curve the RBA cash rate is in terms of market pricing. Bonds see the RBA having to cut the cash rate for another 10 years!
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