Aust bonds stronger on US growth data

AUSTRALIAN bond futures prices are higher following the release of disappointing US economic figures.

Nomura head of fixed income Jon Linton said there had been a rise in demand for bonds globally on Friday night after the US data's release.

The data showed the world's largest economy grew at an annual pace of 2.5 per cent in the March quarter, below economists' expectations of 2.8 per cent growth.

"At the moment, we're following global bond markets," he said.

"It's a very supportive environment for bonds."

Mr Linton said the local bond market was likely to be quiet over the next few days, as traders wait for key US employment figures on Friday and the Reserve Bank of Australia's monthly board meeting on May 7.

At 0830 AEST on Friday, the June 10-year bond futures contract was trading at 96.890 (implying a yield of 3.110 per cent), up from 96.850 (implying a yield of 3.150 per cent) on Friday.

The June three-year bond futures contract was at 97.440 (2.560 per cent) up from 97.410 (2.590 per cent).

View the original article here