Australian bonds remain tad higher in silent trading hours amid slight downside in equities

Australian government bonds remained tad higher during Asian session Wednesday as investors’ risk appetite showed downward signs, tracking a similar movement in the United States’ Treasuries.

The yield on Australia’s benchmark 10-year note, which moves inversely to its price, slipped 1/2 basis point to 2.627 percent, the yield on the long-term 30-year bond fell nearly 1 basis point to 3.150 percent and the yield on short-term 2-year traded nearly steady at 2.032 percent by 04:00GMT.

Wall Street ended higher again yesterday with all the three main indexes showing a climb. On the interest rate front, Federal Reserve Chairman Richard Clarida appears to have backed gradual hikes as he states his believe that “some further gradual adjustment in the policy rate range will likely be appropriate” whilst also mentioning that risks are “less skewed on the downside”, OCBC Bank reported in its Daily Treasury Outlook.

However, other members issued more cautious statements such as Bullard who talked of possible “cracks” in US recovery whilst Bostic highlighted “pockets of distress”. Evans meanwhile reiterated a desire to move rates “to something that’s more neutral” whilst George warned of the trade war. None though have stated an intention to halt the gradual rate hikes. Trump still though slammed Jerome Powell stating that he’s “not even a little bit happy” with his selection of Powell.

Meanwhile, the S&P/ASX 200 index traded 0.30 percent lower at 5,721.50 by 04:10GMT, while at 04:00GMT, the FxWirePro's Hourly AUD Strength Index remained neutral at 13.10 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex