The media is full of the usual waffle today about tightening monetary policy, rises rates head. Blah, blah, blah.
Nothing could be further from the truth. The RBA committed a policy error yesterday that has been called out immediately by the bond market which is the only bourse that understands the sheer magnitude of the inflation challenge ahead.
The bond market reacted to the RBA by buying the very securities that, in theory, it should be selling. Long bond yields were belted as investors stampeded into the long-end of the curve, completely hosing RBA inflation hopes:
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