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AU Bonds have been a little stickier...>

AUSSIE BONDS
AUSSIE BONDS: AU Bonds have been a little stickier than Tsys, and struggled to
turn bid, last dealing at session lows with participants focusing on the pricing
of the new 2050 I/L Bond, due from the AOFM later today, as opposed to the
latest round of U.S. tariffs on China. As a reminder, yesterday the AOFM issued
initial price guidance for the issue at a spread of 9 to 13 basis points over
the mid-yield of the 21 August 2040 Treasury Indexed Bond.
- The lack of dovish rhetoric in the minutes from the RBA's latest MonPol
decision did little for AU Bond bulls, as the Bank offered an upbeat view on
growth and the domestic labour market, which allowed the RBA to reiterate that
the next move in its cash rate will likely be up, as opposed to down.
- The AU/U.S. 10-Year spread is back in to ~-34bp on the back of AU paper's
underperformance.
- On the corporate issuance front NAB launched its 5-Year A$ Bond line.
- The Bill strip last trades 1-2 ticks softer, 3-Month BBSW fixed -0.2bp today.
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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