Australia’s 10-year government bond yield climbed back above 5.1%, rebounding from a two-month low in the prior session as investors positioned ahead of the Reserve Bank of Australia’s upcoming policy decision. The RBA is widely expected to lift the cash rate by 25 basis points to 4.85%, its highest level in nearly twenty years and the fifth rate hike this year.
The anticipated move underscores policymakers’ determination to rein in inflation after the annual rate accelerated to 3.9% in Q3, well above the RBA’s 2–3% target band, while underlying inflation remained elevated at 3.7%. At the same time, Governor Michele Bullock characterized the labour market as “a little tighter” than the RBA had anticipated, even though the unemployment rate held at a five-year high of 4.7% in September.
On the economic data front, the Melbourne Institute’s Monthly Inflation Gauge for Australia rose 0.5% month-on-month in October 2026, up from 0.3% in September and marking a fourth consecutive monthly increase.
