The Australian bonds slumped at the start of the trading week Monday tracking weakness in the U.S. counterpart and as investors remain cautious ahead of the Reserve Bank of Australia’s (RBA) monetary policy decision, scheduled to be held on June 4.
The yield on the benchmark 10-year Treasury note, which moves inversely to its price, jumped 4 basis points to 2.64 percent, the yield on 15-year note surged 3-1/2 basis points to 2.99 percent and the yield on short-term 2-year traded nearly 1 basis point higher at 1.75 percent by 04:30 GMT.
The RBA's commentary has suggested that the leverage-fuelled housing market boom had been the key reason that it is not considering further cuts. Also, improvements in the local and global macro-economy over recent months would further bolster the central bank's resolve, HSBC reported.
In contrast, housing approvals continued to trend lower in May, led by the high rise apartment sector. Further falls are also likely. Residential building approvals fell sharply in May, offsetting the previous month’s increase. The monthly fall was driven by the apartment segment, with New South Wales and Queensland posting 30 percent declines.
Meanwhile, the ASX 200 index fell 0.43 percent to 5,643.50 by 05:20GMT, while at 05:00GMT, the FxWirePro's Hourly AUD Strength Index remained neutral at 46.46 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex
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