Over recent weeks, the yield on 3-year AGS has averaged 0.45 per cent, so this represents a material reduction. We have chosen the three-year horizon as it influences funding rates across much of the Australian economy and is an important rate in financial markets.
It is also consistent with the Board's expectation that the cash rate will remain at its current level for some years, but not forever. To achieve this yield target, we will be conducting regular auctions in the bond market. We published some technical details earlier today and we will keep the market informed of our operations. Our first auction will be tomorrow.