Australian bonds fell, pushing the benchmark 10-year yield to the highest level in nine months, as an increase in iron-ore prices to the most in five weeks curbed demand for the safety of the top-rated debt.
The Australian dollar remained higher after a two-day gain as wage data today matched economist expectations, boosting prospects Reserve Bank policy makers will refrain from cutting borrowing costs next month. New Zealand’s currency, known as the kiwi, was near a 1 1/2-year high after whole-milk powder prices surged to the strongest in more than 14 months.
“I don’t foresee a short-term downturn in commodity prices,” said Hans Kunnen, chief economist at St. George Bank Ltd. in Sydney. “Rising yields are indicative of the potential for economic growth globally.”
The rate on Australia’s 5.5 percent security due April 2023 touched 3.61 percent, the highest since May 2. It will be at 3.8 percent by year-end, St. George’s Kunnen said.
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