Australian bonds jump tracking firm U.S. Treasuries amid silent trading session

The Australian bonds jumped, tracking strength in the U.S. Treasuries during early Asian session Friday despite a set of inspiring economic data released yesterday amid a silent trading session that witnessed data of little economic significance.

The yield on the benchmark 10-year Treasury note, which moves inversely to its price, slumped nearly 4 basis points to 2.79 percent, the yield on 15-year note plunged 3-1/2 basis points to 3.08 percent and the yield on short-term 2-year also traded nearly 3 basis points lower at 1.97 percent by 01:55GMT.

Jobless claims for the week ending September 16 declined to 259k, contrary to consensus expectations of an increase of 302k. We had expected a sharp rise in claims on account of Hurricane Irma that made landfall in Florida on September 10. While claims in Florida did rise by a solid 4.8k, it was more than offset by a sharp fall in claims in Texas (-29.8k). The adverse effects of Hurricane Harvey, therefore, seem to be fading, especially with claims in Texas now edging back to more normal levels.

New economic projections released after the Fed's two-day policy meeting showed 11 of 16 officials see the "appropriate" level for the federal funds rate, the central bank's benchmark interest rate, to be in a range between 1.25 percent and 1.50 percent by year-end.

Meanwhile, the S&P/ASX 200 index traded 0.09 percent down at 5,655.50 by 02:25 GMT, while at 02:00GMT, the FxWirePro's Hourly AUD Strength Index remained highly bearish at –135.56 (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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