Australian bonds sharply rally on short-covering ahead of January employment report

Australian bonds sharply rallied during early Asian session Tuesday as invetsors covered previous short positions ahead of the employment report for the month of January, scheduled to be released on February 15 by 00:30GMT for further insight into the debt market.

The yield on the benchmark 10-year Treasury note, which moves inversely to its price, slumped 2-1/2 basis points to 2.86 percent, the yield on the long-term 30-year note fell nearly 1-1/2 basis points to 3.51 percent and the yield on short-term 2-year traded nearly 1-1/2 basis points lower at 2.00 percent 03:25GMT.

Australian ANZ-Roy Morgan consumer confidence fell 2.6 index last week to 119.5, retracing gains over the previous two weeks. All sub-indices posted declines, though the ‘current economic conditions’ sub-index was the main culprit.

In contrast, The 10-year Treasury yield rose above 2.9 percent, a four-year high, after last week's equity sell-off spurred bond purchases. The 30-year bond yield rose to its highest level since March. Traders are waiting for new consumer price data coming Wednesday.

Meanwhile, the S&P/ASX 200 index traded 0.40 percent higher at 5,798.5 by 03:30 GMT, while at 03:00GMT, the FxWirePro's Hourly AUD Strength Index highly bullish at 110.23 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex

FxWirePro launches Absolute Return Managed Program. For more details, visit http://www.fxwirepro.com/invest