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ACGB Sep-26 Supply Goes Well

AUSSIE BONDS

The latest round of ACGB Sep-26 supply was digested smoothly, with the weighted average yield printing 1.65bp through prevailing mids (per Yieldbroker). The cover ratio rose to 3.40x, bettering the 3.28x recorded previously (albeit with a slightly smaller amount on offer vs. the previous auction), comfortably above the 3.00x mark, representing solid demand.

  • The recent hawkish RBA developments, as well as the absence of immediate demand for the line via the RBA’s SLF did little to dent its appeal, with the same holding true for its richness on the Apr-26/Sep-26/Apr-27 fly.
  • Today’s result builds on the recent strong run of shorter-dated ACGB auctions, which has been aided by the stabilisation away from outright cycle cheaps.

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