3-year Australian Government Bond Yield Target

Over recent decades, the Reserve Bank has targeted the overnight cash rate. The Bank has extended this by also targeting a risk-free interest rate further out along the yield curve. On 19 March 2020, the Board announced a target for the yield on 3-year Australian Government bonds of around 0.25 per cent, to help lower funding costs across the economy.

The Bank is purchasing Australian Government bonds across the yield curve to help achieve this target. The Bank is purchasing government bonds in the secondary market, and will not be purchasing bonds directly from the government.

The Bank expects to maintain the target for three-year yields until progress is being made towards the Bank's goals of full employment and the inflation target. The Bank's expectation, though, is that the yield target will be removed before the cash rate is increased.

The 3-year Australian Government bond yield graph below displays interactive information.