Australia 10Y Yield Hits Fresh 15-Year Peak

Australia’s 10-year government bond yield climbed toward 5.3%, hitting a fresh high since mid-2011 as surging oil prices heightened inflation concerns and strengthened expectations for further rate hikes. Brent crude held above $100 per barrel after Iran and the US launched their biggest wave of attacks on shipping since the war began, threatening to worsen disruptions to energy supplies from the Gulf. The fresh energy-driven inflation pressure sent global bond yields higher, with US Treasury yields reaching their highest levels since 2023 as a buyback program of longer-dated bonds also disappointed. Meanwhile, the oil shock has already fed into domestic consumer prices, which has increased bets of a fourth rate hike this year. Deputy Governor Hauser said the debate at the next meeting would focus on whether to raise interest rates, citing persistently high inflation and upside risks. Markets now price in a 77% chance of a quarter-point hike at the RBA’s upcoming meeting this month.

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