ASX Rates Highlights Q4 – October to December 2025
OTC, Futures, Benchmarks and Collateral insights Q4 2025
ASX provide key trading observations during the period October to December 2025 and the latest interest rate derivative market updates. View the key updates and the full chart pack below.
Trading volumes in Q4 2025 continued to be strong as a result of macroeconomic volatility - supported by market microstructure changes implemented by ASX, including Bond-Roll De-Linking and the 3 year tick change to 0.5bps. Volumes in Q4 2025 were up 14% vs Q3 and up 23% vs Q4 2024.
While the RBA cash rate remained on hold during the period, market expectations shifted from pricing in further rate cuts to pricing in rate increases throughout 2026. As at the end of January, the market was pricing in a ~70% chance of a rate increase in February.
October and November 2025 were the 2nd and 3rd highest non-roll months for interest rate futures activity on record, with only tariff-related volatility in April 2025 driving volumes to exceed these months. Additionally, December 2025 was the 3rd highest month for interest rate futures activity ever, resulting in record quarterly Rates trading volumes in Q4 2025.
The December 2025 Bond Roll was the fourth Roll Period where the Bond Futures (3, 5, 10, and 20 year) contracts outright market was delinked from the roll calendar spread. Significant improvements to top of book liquidity and depth were again recorded in the outright market during the period.
Outright market top of book liquidity improvements throughout the roll period:
The improved liquidity and tradability of the outright market during the roll period contributed to substantial improvements in outright market activity during the roll period:
During Q4 2025, average daily eligible volumes in prime bank NCDs rose to 2.69 billion up from 2.43 billion in the prior quarter demonstrating consistent upward trend from 2.01 billion in Q1 2025. The transaction-based tenor formation remains strong at an average of 3.3 tenors.
The curve is upward sloping across all tenors (1M to 6M), indicating a normal term structure. Rates have increased over time, with the latest observation (31 Dec 2025) showing the highest levels:
1M: 3.550% → 6M: 4.121%.
This reflects market expectations of rising short-term interest rates and higher funding costs in the coming months.
SOFIA Overnight Repo Reference rate
ASX has commenced the implementation of live SOFIA Overnight Repo Reference rate with the VWAP-based calculation methodologies, with a target go-live date set for mid-2026.
The SOFIA External Methodology and Conventions document has been released to the market and is open for industry feedback until the end of January 2026. The link to market notice is here.
| Product | Contracts taken to cash settlement (Dec'25) | % change QoQ |
| 90 Day (IR) | 206,005 | -2% |
| 3 Year (YT) | 146,000 | 79% |
| 5 Year (VT) | 228 | -84% |
| 10 Year (XT) | 103,204 | 86% |
| 20 Year (LT) | 1,140 | 1040% |
| NZ 90-Day (BB) | 74,568 | 25% |
ASX OTC Clearing volumes for Q4 2025 were A$2.19 trillion notional value. Open Interest as at the end of December 2025, was A$4.124 trillion in line with PCP.
During the quarter, banks and clients appeared to take advantage of the lower total cost of clearing available at ASX with an average 50% reduction in Initial Margin requirements, achieved by customers through usage of ASX's fully automated cross-product margin optimisation service.
ASX held a multilateral compression cycle in conjunction with OSTTRA (formerly TriOptima) during Q4 2025, resulting in capital savings and reduced operational risk for cycle participants.
ASX Collateral maintained an average balance of $28 billion in Q4 2025. During the same period, RBA OMO activity continued to decline, falling to $20.8 billion for the quarter. ASX Collateral’s share of OMO remained steady at 50%, amounting to $10.3 billion. Notably, more than one-third of the collateral on the triparty platform now consists of non‑government and non‑semi‑government securities, highlighting growing diversification across collateral types. In addition, most individual collateral lines are valued below $5 million, indicating increased utilisation of previously underused securities.
The full chart pack includes ASX Interest Rate Derivatives volume by session, roll volume, volume vs open interest, calendar year overview, OTC activity, ASX Collateral balances and Austraclear's outstanding bond amounts.
The new ASX 24‑listed contracts, targeted for launch in Mid-2026 subject to regulatory approval, will offer efficient tools for managing fixed income risk, with quarterly, cash‑settled futures aligned to ASX’s existing bond futures.
Link to market notice can be found here.
In March 2025, ASX implemented the Bond Futures Delink initiative to strengthen outright liquidity during the quarterly roll period. The initiative has delivered measurable improvements in liquidity, depth and execution quality across ASX’s Bond Futures complex. Since implementation, outright trading volumes during the roll period have more than doubled, supported by a significant uplift in top of book liquidity, greater depth across the top price levels of the order book and a reduction in price impact from large sized transactions.
In July 2025, ASX re-established the 3-Year Treasury Bond Futures contract minimum price movement ('tick size') to 0.5 basis points. This targeted microstructure change was informed by comprehensive analysis of order book dynamics and industry feedback. Since implementation, ASX has observed a notable uplift in liquidity, with top of book volume increasing by an average of 75% compared to the pre-change 2025 average, alongside sustained average volumes across the top 5 price levels. These enhancements have delivered more efficient execution conditions, supporting improved trading and risk management outcomes for market participants.
Email: Rates@asx.com.au
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International: telephone +61 2 9338 0000
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