We now target 10y ACGB yields of 2.50% at end-2016; 2.65% at end-2017
Following downward revisions to UBS’ US and global growth forecasts, we reassess the outlook for Australian government bonds. We remain of the view that while shorter Aussie rates rightly reflect downside growth risks to the economy, longer-term rates remain too high vs. other developed markets, reminiscent of relative growth prospects of a bygone era.
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal.
He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.
We now target 10y ACGB yields of 2.50% at end-2016; 2.65% at end-2017
