Free Trial

ACGBs Outperform

AUSSIE BONDS

In addition to the broader bid in the core FI space evident on Monday (perhaps linked to the previously outlined Chinese liquidity dynamic), several desks have pointed to international value hunting as a driver behind the outperformance in ACGBs, with the compression of the Australia/U.S. 10-Year yield spread to sub 20bp levels (from ~50bp around the turn of the month) adding further weight to that argument. Market pricing re: the RBA's rate path remains aggressive vs. the Bank's own forward guidance, while the negative RBA purchase adjusted net ACGB supply dynamic and record levels of excess liquidity in the Australian banking system continue to facilitate demand. YM +8.0 & XM +3.5 at typing, with the 3- to 5-Year zone leading in cash ACGB trade.

MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.