RBA’s Aussie Rally Nightmare Worsens After Bond Premium Doubles
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The trade that haunted central banker Glenn Stevens’s quest for a weaker Aussie for four years is back after about three months of respite.
Australia’s 10-year yield climbed 30 basis points to 2.99 percent since the Reserve Bank cut interest rates to an unprecedented 2 percent and said the country needs a weaker currency. That sent the premium over similar Treasuries to 75 basis points, more than double the 14-year low reached in March.