0353 GMT - The recent rise in U.S. bond yields is flowing into the Australian market, and it is bad news for state and federal governments that continue to borrow at high rates, says Shane Oliver, chief economist at AMP. It seems like the bond vigilantes are back after years of hiding in their caves, Oliver says. Public debt interest costs should rise even faster in Australia at a time when government revenues are under threat. It would not be surprising to see the 10-year Australian yields hit 5.5% soon from 5.16% now, Oliver says.