Australian bonds continue to fall on profit-booking, continued gains in equity

The Australian bonds continued to plunge Friday as investors moved away into safe-haven instruments amid gains in riskier assets including equities and crude oil. Also, traders cashed in profits after on the last trading day of the week.

The yield on the benchmark 10-year Treasury note, which moves inversely to its price, jumped 5 basis points to 2.78 percent, the yield on 15-year note also climbed 5 basis points to 3.24 percent and the yield on short-term 2-year ticked 1 basis point higher to 1.86 percent by 05:20 GMT.

Australia's export prices boasted the biggest rise in over six years last quarter as everything from iron ore to coal and liquefied natural gas enjoyed double digit gains, a welcome windfall for profits, incomes and tax receipts.

Friday's data from the Australian Bureau of Statistics showed export prices surged 12.4 percent in the fourth quarter, from the third quarter, to also be up 12.4 percent on the year. Also, import prices edged up just 0.2 percent, implying the terms of trade jumped by more than 13 percent in the quarter.

Lastly, investors are now looking forward to the release of trade balance data next week, besides, the Reserve Bank of Australia’s first monetary policy of 2017, scheduled to be held on February 3 for further direction in the debt market.

Meawhile, the ASX200 index traded 0.14 percent up at 5,655.50 percent at 05:20GMT, while at 5:00GMT, the FxWirePro's Hourly AUD Strength Index remained slightly bearish at -79.33 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex