The yield climbed amid hopes of tax relief and after encouraging reports on business spending and Fed Chair Janet Yellen's remarks that indicated the Fed will maintain a gradual
pace of monetary policy tightening.
This widening in the gap between fixed and variable housing rates is likely to have contributed to the pick - up in the proportion of borrowers choosing to take out fixed - rate housing loans: in November 2004, the latest available data, 11 per cent of new owner - occupier housing loan approvals were at fixed rates, up from 7 per cent three months earlier and the highest share since the beginning of 2004, which followed a
period of monetary policy tightening (Graph 45).