Near term rates are discounting the future

One message that has featured heavily in this week’s meetings is to recognise the function of what markets have already factored in.

In the case of the Australian 2 year government bond yield, it has risen 12 fold since October 2021 and quintupled since January 3rd, 2022.

The quantum of these moves and what rate increases that the market is already discounting shouldn’t be dismissed.

March 29, 2022

by Rob Zdravevski

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