Really basic breakdown:Bond yeild is just one tool in gauging...

Really basic breakdown:

Bond yeild is just one tool in gauging which way the repo rate might move.

At the moment governments are pumping their economies with stimulus packages -> Basically creating money out of nothing -> A side effect can be inflation -> One tool of curbing inflation is to raise the interest rate (repo rate)

So keeping the above in mind. If the repo rate drops you make less money in investments like a banks fix term deposit. So one would rather invest in the stock market to make and receive some form of interest.

The opposite is also true. If the repo rate increases you might be more likely to put your money in a fix term deposit and remove your money from the riskier stock market.

In the chart above it shows that the bond market thinks less inflation is possible.

Once again very basic explanation.

DYOR this is not financial advice.