Australian bond futures prices are firmer as renewed concerns about emerging markets overshadow the US Federal Reserve's tapering decision.
Local bonds have rallied on Thursday despite the US Fed reducing its monthly bond buying program, known as quantitative easing, by another $US10 billion to $US65 billion.
RBC Capital Markets fixed interest strategist Su-Lin Ong said renewed concerns about emerging markets (EM) had hit Asian equity markets and boosted demand for safe haven assets like bonds.
"The ongoing EM concerns lent a fairly supportive tone to fixed income markets," she said.
"That emerged last night; it's kind of lingered in our day. You can see it in most of the risk indicators.
"A bit of a turnaround late this session in equities has taken a bit of the edge of fixed income but compared to yesterday, we're definitely firmer."
Early on Thursday morning, South Africa's Reserve Bank made a surprise decision to raise its interest rate, amid fears of rising inflation and sustained pressure on emerging market currencies.
But the Reserve Bank of New Zealand left its cash rate on hold at 2.5 per cent.
On Wednesday, the Turkish central bank doubled its key interest rate.
At 1630 AEDT on Thursday, the March 2014 10-year bond futures contract was trading at 96.055 (implying a yield of 3.945 per cent), up from 95.945 (4.055 per cent) on Wednesday.
The March 2014 three-year bond futures contract was at 97.150 (2.850 per cent), up from 97.070 (2.930 per cent).