AUSTRALIAN BOND MARKET OPENS WEAKER - JULY 1, 2008.

SYDNEY, July 1 Asia Pulse - The Australian bond market opened weaker today, moving in an opposite direction to US Treasuries, as a high Eurozone inflation reading pushed local yields higher.

At 0830 AEST, the yield on the Commonwealth Government March 2019 bond was at 6.490 per cent, up from yesterday's close of 6.448 per cent, while the June 2011 bond was 6.740, up from 6.705 per cent.

On the Sydney Futures Exchange, the September 10-year bond futures contract was at 93.500, down from yesterday's close of 93.550, while the September three-year contract was at 93.245, down from 93.280.

The Eurozone's harmonised index of consumer prices rose by four per cent in the year to June, compared to a rise of 3.7 per cent in the year to May.

Economists had expected an annual headline inflation rate of 3.9 per cent within the 15-member Eurozone economies.

It was also higher than the European Central Bank's target of a rate just below twp per cent.

ICAP senior economist Matthew Johnson said the European inflation numbers caused the Australian bond market to underperform US Treasuries, which were virtually unchanged overnight.