FX.co ★ Australia 10Y Yield Rises on Strong Jobs Print

Australia's 10-year government bond yield has increased to approximately 4.79%, edging closer to the over two-year peak previously reached. This rise follows stronger-than-anticipated employment figures that bolster the case for a more stringent monetary policy by the Reserve Bank of Australia (RBA). The unemployment rate dipped to a seven-month low of 4.1% in December, down from 4.3%, surpassing expectations of 4.4%. Employment numbers surged by 65,000, predominantly in full-time roles, significantly exceeding the predicted 30,000 increase. This robust labor market performance has led money markets to anticipate a nearly 60% likelihood of an interest rate hike in February, compared to less than one-third before these figures were released. Investors now focus on the December inflation report due next week, which serves as a crucial indicator for policymakers ahead of the upcoming policy meeting. Earlier this month, RBA Deputy Governor Andrew Hauser remarked that inflation remains "too high" and that the board is maintaining a cautious, patient stance towards policy.