Australian 2-year bond yield hits near 3-week high following optimism over faster Fed interest rate hikes

Australian 2-year bid yields hit a near 3-week high at the start of the week Monday, following greater optimism among investors for a faster pace of interest rate hike this year. Also, a better-than-expected U.S. non-farm payroll data released late last week weighed on bond prices.

The yield on the benchmark 10-year Treasury note, which moves inversely to its price, jumped 2 basis points to 2.82 percent, the yield on the long-term 30-year note also surged 2 basis points to 3.41 percent and the yield on short-term 2-year too traded 2 basis points higher at 2.04 percent by 03:00 GMT.

Treasuries saw downward pressure across the curve following the February employment report that revealed a +313k increase in non-farm payrolls, alongside an unchanged unemployment rate of 4.1 percent.

By most measures this report was granted the status of better than expected. However, a meager +0.1 percent m/m increase in average hourly earnings was enough to dampen expectations for a more aggressive policy response from the FOMC

Meanwhile, the S&P/ASX 200 index traded 0.83 percent higher at 6,012.10 by 03:15 GMT, while at 03:00GMT, the FxWirePro's Hourly AUD Strength Index remained slightly bullish at 85.07 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex

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