Australia’s 10-year government bond yield rose to around 4.87%, hovering near its highest level in more than two years, after the RBA signaled that interest rates would need to remain restrictive to tackle persistent inflationary pressures. Speaking to the House of Representatives Standing Committee on Economics, Governor Michelle Bullock said the central bank remains cautious to ensure price stability. Persistent price pressures in services and a resilient labor market continue to support domestic demand, complicating the timing of any rate cuts. She emphasized that the board is in no rush to alter its restrictive stance, following last week’s unanimous decision to raise rates. Meanwhile, after strong gains in the prior two months, Australia’s household spending unexpectedly fell in December, reflecting the ongoing impact of high living costs and elevated interest rates.
