Australia Mulls Lowering Ultra-Long Bond Sales Amid Volatility

Australia’s debt manager is considering scaling back its issuance of ultra-long bonds as rising yields make funding more expensive.

The Australian Office of Financial Management plans to issue around A$150 billion ($99 billion) worth of bonds this year as funding officials navigate one of the steepest yield curves in developed markets. Adding to the pressure: Australia’s longer-term bond yields have become increasingly sensitive to gyrations in the US bond market, which has been volatile this year due to fears over the fiscal deficit and shifting bets on rate cuts.