The Australian bond market has opened firmer, tracking the move on US Treasuries during offshore trading.
At 0830 AEDT on Wednesday, the March 10-year bond futures contract was trading at 96.620 (implying a yield of 3.380 per cent), up from Monday's close of 96.600 (3.400 per cent).
The March three-year bond futures contract was at 97.210 (2.790 per cent), up from 97.170 (2.830 per cent) previously.
During the overnight session, the Australian bond futures markets took its cues from the move on US Treasuries, which rallied in response to an encouraging result from the auction of three-year government debt.
Bond markets in Europe also settled stronger.
The US auction came after the minutes of the US Federal Open Market Committee published last week indicated the US central bank was considering ending its quantitative easing program by the end of 2013.
The US will also auction off 10-year and 30-year bonds later this week.
Weakness on global equity markets also spurred demand for fixed income assets, with the S&P500 on Wall Street closing down about 0.3 per cent.
"US Treasuries gained overnight as investors were attracted by higher yields after Treasuries sold off sharply over the past week," ANZ said in a research note.
"Prices also benefited early in the session from safe-haven bids on rumours (later proved to be untrue) that France's sovereign rating was about to be downgraded.
"Australian bond futures also rallied overnight, outperforming US Treasuries at the short end."
The Australian Bureau of Statistics will release retail sales figures for November at 1130 AEDT, as well as job vacancies data for the three months to November.
New home sales data from the Housing Industry Association are also due for release.