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ACGB May-34 Auction Goes Smoothly But Less Demand Present

AUSSIE BONDS

Expectations of sustained strong pricing at auctions proved accurate, as the weighted average yield printed 1.0bp through prevailing mids (per Yieldbroker). However, the cover ratio moved lower to 2.9857x from 4.2714x at the June auction.

  • The more dovish assessment of the RBA’s policy outlook, combined with a still elevated outright yield, a steeper curve, a low level of issuance, and the line’s inclusion in the XM basket all look to have contributed to today’s bidding.
  • There has been nothing in the way of notable movement in ACGB May-34 cash trade and XM futures post-auction.

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