The Australian government bonds remained flat on the second trading day of the week Tuesday, as investors remained side-lined in a muted session ahead of the Reserve Bank of Australia’s (RBA) Financial Stability Review, scheduled to be released by end of this week.
The yield on Australia’s benchmark 10-year note, which moves inversely to its price, traded steady at 0.896 percent, the yield on the long-term 30-year bond also remained flat at 1.497 percent and the yield on short-term 2-year too hovered around 0.644 percent by 05:35GMT.
News that US has placed another eight Chinese technology companies (including Hikvision, Sense Time and iFlytek) under the blacklist for human rights violations in Xinjiang on the eve of trade talks suggest that the odds of an interim or mini US-China trade deal has fallen further. US president Trump also warned that a “bad” outcome in Hong Kong would hurt China trade talks, OCBC Treasury Research reported.
It is plausible that China retaliates through its Unreliable Entities List, which may in turn mean the US pushes through with its planned 15 October tariffs hikes. S&P500 closed down 0.5 percent, while UST bonds sold off with the 10-year yield +3bps at 1.56 percent, the report added.
Meanwhile, the S&P/ASX 200 index flattened at 6,565.00 by 04:40GMT.


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