FX.co ★ Australia 10-Year Yield Steady at Near 3-Week High

Australia's 10-year government bond yield remained stable on Thursday, hovering around a near three-week high of 4.33%. This was due to investors reevaluating the Reserve Bank's policy outlook after monthly inflation figures exceeded expectations. Prior to this, the likelihood of an interest rate cut next week was already low, but the chance of a reduction in November has now decreased to 40%, down from 70% before the inflation data release. While the Reserve Bank of Australia (RBA) has downplayed the monthly data's significance, citing its volatility, the details of the August Consumer Price Index (CPI) report hinted at potential upward pressure on third-quarter inflation. Overall, recent economic data has been slightly stronger than anticipated, justifying the central bank’s cautious approach. Furthermore, RBA Governor Michele Bullock stated earlier this week that the Australian economy is currently in a favorable position with regard to both growth and inflation, indicating no immediate need for rate cuts.