Australian government bonds traded narrowly mixed at the start of the week on Monday as investors preferred to stay on the sidelines ahead of Reserve Bank of Australia (RBA) Governor Philip Lowe speech, amid nervousness about global trade tensions.
The yield on Australia’s benchmark 10-year note, which moves inversely to its price, traded nearly flat at 2.670 percent, the yield on the long-term 30-year note remained steady at 3.259 percent and the yield on short-term 2-year also fell 1 basis point to 2.036 percent by 03:00 GMT.
In the United States, Treasuries saw upward pressure across the curve, alongside equity market weakness, amplified by overnight trade war escalation (with US President Trump considering on imposing another $100 billion worth of tariffs on Chinese imports) and weaker than expected employment data for March (non-farm payrolls increased +103K, versus +326K increase in February and an increase in the unemployment rate to 4.1 percent).
Resumed firming in average hourly earnings provided some offset to the headline weakness. However, the overriding backdrop of concern related to trade tensions were enough to define the session even ahead of the lackluster employment release. Markets now look ahead to a greater flow of data in the week ahead, highlighted by consumer prices and minutes from the 20-21 March FOMC meeting on Wednesday. Additionally, markets receive 3-year Note, 10-year Note and 30-year Bond auctions on Tuesday, Wednesday and Thursday, respectively.
Meanwhile, the S&P/ASX 200 index traded 0.92 percent lower at 5,789.5 by 03:20 GMT, while at 03:00GMT, the FxWirePro's Hourly AUD Strength Index remained neutral at -41.67 (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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