So, the bond bash resumed today for reasons discussed here. It’s feels big but is it? The answer is yes and no. In some markets the percentage moves are massive, such as Germany, where the 5 year has moved from -.15% to 0.1%, an astonishing percentage increase. But let’s face it, it’s hardly going to break the bank is it?
For Australia, the whole curve has jumped and steepened. The 2 year yield is at 2.15%, pricing in more than half a rate hike, long end yields are up even more chasing international markets:
Thus the Australia bond curve has steepened suggesting a better growth outlook:
Advertisement