Australian bond futures prices are lower after strong US housing data encouraged traders to move out of safe haven assets.

The number of new home building permits issued in the US increased eight per cent in April, much higher than market expectations.

Australian bond futures followed US Treasury bonds weaker after the release of the housing figures, St George senior economist Jo Horton said.

“US government bonds eased, with upbeat housing market data setting the tone and reducing safe haven demand, despite disappointing US consumer sentiment data,” she said.

“Safe haven flows were also diminished given a better session in

some peripheral European government bonds.”

At 0830 AEST on Monday, the June 2014 10-year bond futures contract was trading at 96.275 (implying a yield of 3.725 per cent), down from 96.290 (3.710 per cent) on Friday.

The June 2014 three-year bond futures contract was at 97.140 (2.860 per cent), down from 97.170 (2.830 per cent).

Investors are now waiting for Tuesday’s release of the minutes of the Reserve Bank of Australia’s May board meeting.

The cash rate was left unchanged for the ninth month in a row at the meeting, but investors will be looking for any indications of the timing of the bank’s next move.