ACGB May-34 Supply Digested Smoothly, Although Cover Capped

The latest round of ACGB May-34 supply sees firm pricing, with the weighted average yield printing 1.02bp through prevailing mids (per Yieldbroker), although the cover ratio was nowhere near as strong as the previous (initial) tap of the line, even when adjusting for the uptick in the auction size this time around. The difference between the average and high yield held tight. While this no doubt represented a smooth auction, the uncertainty surrounding global central bank terminal rates seems to have constrained demand to a degree. The line cheapens a touch post-auction, aided by weakness in the wider core global FI space.