Remaining Under Pressure

YM -9.5 and XM -5.0, with selling pressure resuming as the former tests its overnight base. Note that XM has failed to threaten its overnight lows thus far. 3s present weakest point on the curve in cash ACGB dealing, while super longer cash ACGBs run ~4bp cheaper on the session. EFPs are narrower on the session, with the 3-/10-Year box flattening. Bills run 6-14 ticks softer on the day, with the reds leading the strip lower.

• There hasn’t been much in the way of meaningful headline flow to digest, with the rate of expansion across the 3 headline S&P flash PMI prints revealing a slightly swifter rate of expansion when compared to that observed in March.
• The commentary surrounding the release provided familiar points of discussion: “The expansion of the Australian economy continued in April, according to the S&P Global Flash Australia Composite PMI, buoyed by the easing of COVID-19 disruptions. Foreign demand played a part as well with new export business rising for the first time since December 2021. Price pressures persisted, however, for private sector firms that faced higher costs across raw material to wages. Input costs rose at the fastest pace since data collection began in May 2016, reflecting the impact from both the Ukraine war and lockdowns in China. Higher employment levels in April remained a bright spot to highlight, though the lack of suitable candidates have contributed to a slowdown of hiring activity. Meanwhile, despite better output growth, business confidence eased in April which is a worrying trend.”