Australian bonds remain tad higher ahead of RBA Governor Lowe’s speech, Q3 CPI

The Australian government bonds remained tad higher during Asian session of the first trading day of the week Monday ahead of the Reserve Bank of Australia (RBA) Governor Philip Lowe’s speech, scheduled to be delivered on October 29 by 06:45GMT.

Also, the country’s consumer price inflation (CPI) for the third quarter of this year, due for release on the following day by 00:30GMT shall impart additional direction to the debt market.

The yield on Australia’s benchmark 10-year note, which moves inversely to its price, slipped 1/2 basis point to 1.102 percent, the yield on the long-term 30-year bond fell 1 basis point to 1.681 percent while the yield on short-term 2-year traded flat at 0.784 percent by 05:30GMT.

The AUD will be driven by the Australian CPI release on Wednesday and US events, including the October FOMC meeting (with the outcome known early Thursday morning AEDT), ANZ Research reported.

News that phase one of the US-China trade deal was getting closer led to renewed risk-on sentiment with Treasuries selling off across the curve, the report added.

Lastly, yields moved higher across most of the US curve amid risk-on sentiment. The US 10-year Treasury was up 4bp at 1.79 percent. Bund yields similarly pushed 4bp higher, rising to -36.2bps. The S&P 500 was up 0.4 percent and the DAX up 0.2 percent, ANZ further noted in the report.

Meanwhile, the S&P/ASX 200 index traded tad 0.34 percent up at 6,717.50 by 05:35GMT.