October 22, 2024 01:03 GMT
AUSSIE BONDS: Cash Curve At Steepest This Year
AUSSIE BONDS
The cash ACGB curve steepened by 4bps today, reaching its highest level since early November 2023.
- With RBA easing expectations having already been unwound on the back of stronger domestic data, the ACGB 3/10 cash curve has been closely aligned with recent upward pressure on the US 10-year tsy yield. This is reflected in the 30-day correlation between the two, which has returned to positive territory after two months in negative territory.
- Since mid-September, the US 10-year yield has risen by 55-60bps. Over the same period, the ACGB 3/10 cash curve has steepened by 15bps, now standing at 50bps.
- This correlation suggests that global yield dynamics are exerting significant influence on Australian bond markets, despite the local economic backdrop.
Figure 1: ACGB 3/10 Cash Curve
Source: MNI – Market News / Bloomberg
Keep reading...Show less
130 words