The Australian government bonds plunged during Asian trading session Monday as investors await the Reserve Bank of Australia’s (RBA) September monetary policy meeting minutes, scheduled to be released on October 15 by 00:30GMT and the country’s employment report, due for release on the following day for further direction in the debt market.
The yield on Australia’s benchmark 10-year note, which moves inversely to its price, jumped 3-1/2 basis points to 1.050 percent, the yield on the long-term 30-year bond surged nearly 2-1/2 basis points to 1.636 percent and the yield on short-term 2-year remained 2 basis points higher at 0.724 percent by 03:30GMT.
Putting aside the question of why it took them this long only to get to a “Phase 1” deal, the fact that there was some trade truce between the US and China over the weekend will allow Asian markets to breathe more easily this week, OCBC Treasury Research reported.
In exchange for China’s doubling its purchase of American agricultural goods (as much as $50 billion according to Trump, but yet to be confirmed by China), US will not carry out the Oct 15th tariff increase of 5ppt more on USD250 billion worth of imports from China, the report added.
"Looking ahead, the two sides are expected to work out the details of the mini agreement in the coming month, with the expectation of President Trump and Xi signing it on the sidelines of the APEC summit in Chile on November 16-17," OCBC further commented in the report.
Meanwhile, the S&P/ASX 200 index traded tad higher at 6,627.50 by 03:35GMT.


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