Australian bond futures extended their rally on a weak night for global stock markets.
JP Morgan interest rate strategist Sally Auld said bond markets performed well overnight as stock markets fell.
In New York the Dow Jones Industrial Average dropped by 0.33 per cent while the S&P 500 lost 0.28 per cent.
European equities markets fared worse with London's FTSE 100 index dropping 0.56 per cent and Paris' CAC 40 dropped 0.92 per cent.
Ms Auld said the release of a survey showing confidence fell among US consumers in March and a poorly received Spanish bond auction added to the negative sentiment.
"The fact that equities didn't have a great night and there was some pretty weak data in the US and the Spanish debt auction didn't go too well meant that bond markets did pretty well," she said.
She said Australian bond futures were likely to remain strong during Wednesday but their movement would be restricted by a lack of economic data releases.
"Early on, our market feels better bid and it has opened up a little higher than the close.
"But I can't imagine yields are going to shoot too much lower."
At 0830 AEDT on Wednesday, the June 10-year bond futures contract was trading at 95.830 (implying a yield of 4.170 per cent) up from 95.770 (4.230 per cent) on Monday afternoon.
The June three-year bond futures contract was at 96.380 (3.620 per cent), up from 96.310 (3.690 per cent).