Australia’s 10-year government bond yield jumped to 4.86%, hitting its highest level since November 2023, after the Reserve Bank raised rates by 25 basis points to 3.85% as expected. The RBA became the first major central bank to hike this year, noting that the unanimous decision came as a broad set of indicators over recent months showed inflationary pressures strengthened markedly in the second half of 2025, while private demand expanded faster than anticipated. Policymakers also raised forecasts for inflation, growth, and employment this year, even assuming two rate hikes, according to the quarterly Statement on Monetary Policy. The trimmed mean is now expected to remain above the 2–3% target range through 2025 and is not projected to reach the midpoint until after 2027. Markets are now focused on Governor Michele Bullock’s post-meeting press conference for further clues on the RBA’s policy outlook.
