ACGBs Creep Higher As Participants Weigh Local Omicron Matters

Musings surrounding Australia's Omicron situation may be aiding today's ACGB strength, with domestic markets open again after a four-day break. NSW reported a record surge in new Covid-19 cases this morning, while PM Morrison scheduled a National Cabinet meeting for Thursday to discuss a "gear change" on the country's virus countermeasures. The Cabinet will discuss narrowing the definition of close contacts, tweaking the testing requirements to allow for a wider use of rapid antigen rather than PCR tests, as well as altering rules on self-isolation and furloughing staff.

• Aussie bond futures continued to push higher, YM last sits +3.5 and XM +4.0 (both close to session highs). Cash ACGB curve has bull flattened, with yields last seen 2.7-5.0bp lower. Bills trade -1 to +6 ticks through the reds.