Australian bond futures prices are lower after US employment figures came in much stronger than expected.
US non-farm payrolls for June rose 288,000, well above market expectations of 215,000.
The figures caused a bond price selloff, ANZ economists said.
"The momentum in the US labour market has clearly picked up in recent months," the economists said.
"US Treasuries sold off strongly following the release of US payrolls data overnight, before rallying modestly towards the end of the session.
"Australian bond futures underperformed US Treasuries at the long end of the curve overnight."
At 0830 AEST on Friday, the September 2014 10-year bond futures contract was trading at 96.410 (implying a yield of 3.590 per cent), down from 96.450 (3.550 per cent) on Thursday.
The September 2014 three-year bond futures contract was trading at 97.340 (2.660 per cent), down from 97.370 (2.630 per cent).