Australian bond yields rise as Aussie jobless rate slips to 5.1%
|- Aussie bond yields are cheering the big beat on Aussie Employment Change.
- The jobless rate unexpectedly declined to 5.1% in December.
- Full-time jobs, however, declined and could cap upside in yields.
Australian government bond yields are rising in response to a better-than-expected Aussie jobs report released at 00:30 GMT.
At press time, the yield on the 10-year government bond is trading at 1.12%, representing a two basis point gain on the low of 1.09% seen ahead of the jobs
report.
The two-year yield, which is more sensitive to interest rate expectations, has so far added more than four basis points to trade at 0.75%.
Australia's jobless rate dipped to 5.1% in December from the prior month's 5.2%. Meanwhile, the economy added 28.9K jobs, which were far higher than the forecasted figure of 15.K in December.
The job growth, however, was mainly fueled by part-time work, as full-time jobs declined by 0.3K. So far markets have not paid attention to that detail, as evidenced by the uptick in yields and AUD/USD's 38-pip rise.
However, the jobs report is not strong enough to force markets to price out expectations for an RBA rate cut at the Feb. 4 meeting. As a result, both yields and the AUD may trim gains.
It's worth noting that markets were pricing about 56% chance of a 25 basis point rate cut ahead of the jobs report.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.