Source: RBA
The above chart shows the latest Australian Government Bond Yield curve which is around 5 to 2obps higher than it was a little over three weeks ago. On the scale of yield curve movement over the last few months its largely market noise and is therefore relatively meaningless…the market is still pricing in further RBA rate decreases and the outlook for the Australian economy is still relatively weak…its currently difficult to find any strong economic growth driver that doesn’t carry significant risk of not fulfilling its potential and that includes China.