Australian Bonds Rally on Dovish Rate Outlook, Treasuries Rise

Australian bonds rallied, lifted by an overnight rise in Treasuries and a dovish interpretation of central bank comments on its fight against inflation.

Yields slid about 10 basis points across the curve after the implied yield on 10-year futures slid roughly 7 basis points overnight. Swap traders scaled back bets on Reserve Bank tightening after Deputy Governor Andrew Hauser said the central bank is taking a one- to two-year view on inflation rather than reacting to individual data releases.