Australian bonds remain nearly flat in muted trading ahead of RBA’s monetary policy meeting

Australian government bonds remained nearly flat during Asian session of the first trading day of the week Monday amid a muted day that barely witnessed any data of major economic significance ahead of the Reserve Bank of Australia’s (RBA) monetary policy meeting, scheduled to be held on July 2 at 04:30GMT.

The yield on Australia’s benchmark 10-year note, which moves inversely to its price, remained tad higher at 1.329 percent, the yield on the long-term 30-year bond hovered around 1.933 percent and the yield on short-term 2-year too remained flat at 0.979 percent by 04:40GMT.

Another temporary ceasefire for fresh US tariffs as US and China head back to the negotiating table for further talks, as well as a nice photo-op and handshake between US president Trump and North Korean leader Kim Jong Un also led to increased expectations that negotiations for the latter’s denuclearization will restart, OCBC Treasury Research reported.

For now at least, China has committed to buy more US goods and Trump will allow US companies to supply Huawei, albeit White House advisor Kudlow warned that the latter was not being granted a “general amnesty”, the report added.

Meanwhile, the S&P/ASX 200 index remained tad higher at 6,588.50 by 04:45GMT, while at 04:00GMT, the FxWirePro's Hourly AUD Strength Index remained neutral at 39.34 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex