July 26, 2024 04:55 GMT
ACGB Curve Flattens, OIS Slightly Firmer Into Year-End
AUSSIE BONDS
ACGBs (YM +1 & XM +1.5) are richer today with what was a subdued trading session with little int he way of domestic drivers or data, as a results moves were largely tied to US tsys.
- The ACGB curve has bull-flattened today, yields are 1-4bps lower, with the 10Y back below 4.30% for the first time this week.
- The AU-US 10-year yield differential little changed today at+5bps.
- The swap curve has bull-flattened with yields +/- 2bps
- The bills strip has flattened, trading flat to +2.
- RBA-dated OIS pricing is a pricing 1-2bps firmer heading into year-end, with the first full cut not priced in until July 2025
- Cross assets: Equities were higher today, led by financials & miners with commodity prices higher, the AUD was the top performing G10 currency after falling over 2% this week as the yen carry trade was unwound.
- Looking ahead to next week, focus will be on Retail Sales & CPI on Wednesday.
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