27.08.202502:39:50UTC+00AUS 10-Year Yield Rises After Hot Monthly CPI Print

Australia’s 10-year government bond yield climbed to 4.33% on Wednesday, nearing its highest point in over three weeks. This rise comes as unexpectedly high monthly inflation figures complicate the Reserve Bank of Australia's (RBA) future policy actions. In July, headline inflation surged to a one-year peak of 2.8%, up from June's 1.9%, and exceeded market predictions of 2.3%. This increase was mainly due to rising electricity costs. Core inflation also increased to 2.7%, the highest in three months, up from 2.1% in June. These developments follow the RBA's meeting minutes released just a day before, where the central bank reiterated its readiness to implement further interest rate cuts, contingent on inflation continuing to decrease as projected. However, the latest inflation data now raises questions about when the RBA might proceed with easing monetary policy. Despite this uncertainty, the market remains optimistic that rate cuts could recommence in November.