Local bond yields continue to drift lower even while the press is full of inflation and rising interest rates / bond yields. As we mentioned above Bank Bill futures are forecasting the RBA Cash Rate to be at 1.1% by mid-2024, interestingly when we last saw rates at 1% in 2019 the Australian 10-year bond yield was trading under 1.5% implying there’s a fair bit of inflation / rate hikes already built into longer dated bonds.
MM remains bullish bond yields longer-term
