Yields easing
Australia's bond yields are on the way back down now, as markets adjust to the disinflationary environment.
Australia's 10-year bond yield slipped back below 3.9 per cent today, back down to mid-2023 levels.
Banks have already been responding, with lower term deposit rates.
With 3-year bond yield also back down to 3½ per cent, we should see more cuts to fixed rate mortgages over the coming months.
From today, for example, Westpac dropped fixed rates by 0.50 per cent to 0.80 per cent, across a range of investment and owner-occupier products.
Whether or not borrowers will jump on fixed rate offerings is a different question that Chris and I will be discussing on the Australian Property Podcast on Sunday morning.
Australia is treading a fine line between bringing inflation back down and risking a potentially nasty recession (cf. New Zealand).
