May 17, 2024 05:17 GMT
ACGBs Cheaper, Curve Steepens
AUSSIE BONDS
ACGBs (YM -1.0 & XM -2.0) are cheaper today, we trade near best levels for the session. It has been a relatively quiet session for global rates, focus has been in Japan where the BoJ refrained from cutting bond purchases. The past week has seen yields move 5-11bps lower, with the 5 & 30yr tenors seeing the largest moves, looking ahead to next week it will be a relatively quiet one with Westpac Consumer Conf on Tuesday, a 30yr auction Wednesday and a 5yr auction on Friday.
- Cross-asset moves: Risk assets are lower today, regional equities seeing profit taking although have ended the week higher with the MSIC Asia Pacific up about 2%, US equities futures are trading unchanged, in the FX space the yen is the worst perfoming following AUD, NOK & NZD with the BBDXY up 0.13%, Iron Ore is up 0.26% at $117.15/ton
- US Tsys curve bull-steepened with the 2y10y +1.392 at -40.855, yields were flat to 2.5bps lower
- The ACGB curve is slightly steeper today and has pivoted at the 10y with the 2y10y +1.30 at 29.100, yields are flat to 2.5bps higher, while the AU-US 10-year yield differential is 1.5bps lower at -16.5bps
- Swap rates are 1bp lower
- The bills strip is flat to 1bps higher
- RBA-dated OIS implied rate is little changed today into year-end with 17bps of easing into the year-end to a terminal rate of 4.18%
- Looking ahead, we have Westpac Consumer Conf on Tuesday.
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