Australia’s 10-year government bond yield fell below 5.2%, hitting a seven-week low as a tech-led global equity selloff spurred demand for safe-haven assets. Concerns over the enormous capital requirements of AI development and the sustainability of heavy data centre investment fueled fears that a slowdown in spending could weigh on economic growth. This prompted a rally in US Treasuries that spilled over into the Australian bond market. The decline came despite oil prices topping $113 a barrel, raising concerns over renewed inflationary pressure. A top RBA official warned that the inflation outlook remained materially worse, partly due to elevated oil prices, and stressed the need to anchor inflation expectations ahead of the November 3 meeting, where policymakers will consider a fifth rate hike this year. Markets currently imply a 64% chance of a quarter-point increase in November. Attention now turns to Q3 inflation data due next week for further clues on the policy outlook.