For the first time in 2015, Australian government 10-year bonds are yielding more than 3%.
In line with the sell-off in bonds globally, the advance in the 10-year yield has accelerated this week following the decision by the RBA to remove its explicit easing bias in its May monetary statement.
Not even a underwhelming jobs report for April could stop the relentless march higher with yields jumping above 3% shortly after its release.
It’s all a very different story that seen in early April with 10-year yields were sitting below 2.25%.
While yields have moved a long way quickly, should the global sell-off in bonds continue and the RBA not indicate in tomorrow’s statement of monetary policy that they may still cut rates further, the rising yield tide will continue to underpin the Australian Dollar and act as a negative force on higher-yielding stocks.