Australian bonds nearly flat in subdued trade

The Australian government bonds traded nearly flat on Friday, succumbing to thin trading activity during a relatively quiet session that witnessed data of little significance.

The yield on the benchmark 10-year Treasury note, which moves inversely to its price, fell 1/2 basis point to 1.928 percent and the yield on short-term 2-year note remained steady at 1.431 percent by 04:50 GMT.

On Thursday, Australia’s unemployment rate fell to 5.7 percent in July, against market consensus for an increase of 5.8 percent, as compared to previous 5.8 percent in June. Employment change for July came in at +26.2K (expectation was for +10K), from +10.8K, revised from +7.9K in June. Full-time jobs fell to -45.4K, from +44K, revised from +38.4K. This was the biggest fall in full-time employment since 2003; part-time jobs rose to +71.6K, from -30.6K in June.

The Australian bonds have been closely following developments in oil markets because of their impact on inflation expectations, which are well below the Reserve Bank of Australia's target.

The crude oil prices climbed for a seventh straight day, with Brent crude rising above $50 for the first time in six weeks as the world's biggest producers prepared to discuss a possible freeze in production levels. The International benchmark Brent futures rose 0.02 percent to $50.90 and West Texas Intermediate (WTI) jumped 0.27 percent to $48.35 by 04:50 GMT.

Meanwhile, the benchmark Australia's S&P/ASX 200 index traded 0.06 percent lower to 5,487 by 04:50 GMT.