China's slowdown could be the 'one' this time, Chinese authorities stop reporting youth unemployment numbers. Eerily similar to when China underreported and stopped reporting COVID infections. Pointing to a severe recession for the Chinese economy. Australia will take a massive hit, all eyes on the AUD and Aust bonds.

China clamps up in a crisis, like it did when COVID-19 spread throughout the country in 2020 and 2021, withholding data and infection rates, the economic crisis in China is probably capitulating at a rapid rate and now Chinese authorities have begun halting youth unemployment rates.  This is a huge negative for markets connected to Chinese growth, which is  basically the whole world, more so Australia.  Uncertainty and the withholding of economic numbers will only maintain its negative pass-on affect for the Australian Dollar (AUD) and bonds.  

At this point in time, it is the AUD that under pressure, losing over 6% of its value since July 2023, dropping from 0.68 to its current rate of 0.64 v's the U.S. Dollar (USD).  A risk barometer currency that in times of a bull market for global stocks, the AUD rallies in tandem.  What is interesting, please refer to Chart 1, is that AUD bonds, particularly the 10 YR yield is rising, which is telling the market that sticky inflation is still dormant throughout the Australian economy, whilst the AUD has sold off upon the Reserve Bank of Australia (RBA) pausing it rate increases on the 1st Aug and China entering deflation on the 8th Aug.  The lack of safe haven appeal in Aust bonds, could also be a concern pertaining to the fact that the Australian economy is almost solely reliant on exports (iron ore/commodities) to China and imports (Chinese tourist).  

A push and pull scenario of liquidity tightening within the Australian economy and persistent inflation.