The Australian three-year bond yield chopped around last week in a fairly volatile manner following some conflicting messaging from various US Fed members; the end result was the short-dated local bond closed unchanged, still trading below the 4.35% cash rate.
- No change; we continue to look for Australian short-dated yields to eventually re-test 3% in 2024/5 but acknowledge such a move will require a move towards a more accommodative stance by central banks.
MM remains bullish toward Australian 3-Year Bonds, negative on yields
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The US 30-years stabilised last week, and although Fed officials appeared more than happy to keep money markets second-guessing, at least we are finally seeing some more dovish comments creeping through.
- We continue to target a retest below 4.5% over the coming months – a similar pullback to that in late 2022 targets the 4.25% area.
MM remains bearish on US bond yields over the medium-term
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