- Australian government bond yields hit record lows.
- Australia’s underemployment rate ticked up in May.
The yield on the Australian government bond yield fell to a record low of 0.992% on Thursday after the Australian Bureau of Statistics reported a higher than expected jobless rate.
Australia’s unemployment rate remained steady at 5.2% in May, contradicting the market expectation of a drop to 5.1%.
The economy added 42,300 jobs in May, beating both the expected figure of 17.5K and the previous month’s print of 28.4K by a big margin.
However, the vast majority of the jobs created were part-time. As a result, the underemployment rate again ticked up to 8.6%.
The lack of quality jobs likely boosted bets of an RBA rate cut in July, sending the bond yields to record lows. While the 3-year yield fell below 1% for the first time on record, the benchmark 10-year government bond yield slipped to a fresh lifetime low of 1.399%.