Australia 10Y Yield Holds at 3-Month Low

Australia’s 10-year government bond yield held its recent decline to around 4.8%, staying near a three-month low as markets widely expect the Reserve Bank will hold policy rates next week. A series of softer economic releases, from GDP to housing prices, reinforced signs that the central bank’s three rate hikes earlier this year began to filter through the economy. Market pricing now ruled out a move at the June 16 meeting, while expectations for an August rate hike have eased sharply to around 35%, down from more than 80% a month ago. The May CPI report due on June 24, will be pivotal after an unexpectedly soft April inflation reading, as policymakers look for clearer evidence that price pressures remain strong. Meanwhile, growing optimism over an imminent US–Iran peace deal eased concerns about persistent inflation, after US President Donald Trump said an agreement could be reached as early as this weekend following his decision to postpone planned strikes on Iran.

Australia 10 Year Government Bond Yield decreased to 4.83%, the lowest since March 2026. Over the past 4 weeks, Australia 10Y Bond Yield lost 20.50 basis points, and in the last 12 months, it increased 58.70 basis points.

Australia’s 10-year government bond yield fell below 4.9%, retreating from an over two-week high as risk-off sentiment intensified amid escalating geopolitical tensions and softer expectations for domestic policy tightening. A recent run of softer economic data prompted investors to rule out another rate hike at the Reserve Bank’s upcoming policy decision next week, as three rate hikes earlier this year began to filter through the economy. Economists have also scaled back bets for an August move and now see rates peaking at 4.35%. Still, Governor Michele Bullock reiterated last week that the central bank remains firmly focused on bringing inflation back to target. The upcoming May CPI print on June 24 would provide clear evidence of pass-through to higher prices after a weaker April reading. Meanwhile, hostilities in the Middle East dragged on as the US launched fresh strikes on Iran, casting doubt on a lasting peace deal, which would extend the closure of the crucial Strait of Hormuz.