The Australian bond market stands to benefit from the so-called quantitative easing imposed by the US government to prop up the US dollar.

Among the treasury bonds with three month to as long as a 15-year tenor, the Australian bonds have the highest market yield averaging 5.15 percent to 5.21 percent. These are relatively higher than that of US bonds with average yields of 2.5 percent and 3.9 percent, respectively for 10-year and 30-year tenor.

Pacific Investment Management Co. (Pimco), the world's largest bond fund manager said in a note to clients that so far the greater yields offered by Australian bonds because of the available liquidity.

In a related report of Bloomberg and the Australian Financial Review, the country's ageing population would also prompt local investors to acquire bonds.

The report added citing Pimco head of Australian operations John Wilson that "the nation's superannuation sector has the lowest proportion of fixed income investments when compared to its peers in the Organization for Economic Cooperation and Development."

Australia's federal and state governments have the capacity to increase debt levels to fund infrastructure projects, according to another report made by Colonial Investments, a subsidiary of the Commonwealth Bank of Australia.

Increasing Australian government debt by more than A$220 billion ($217 billion) by June 2014 would keep debt at an internationally-low 30 percent of gross domestic product, according to research made by Colonial, which oversees about $135 billion in managed funds.