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AUSSIE BONDS: Cheaper & At Worst Levels, Mixed Domestic Data

AUSSIE BONDS
RegionGlobalBulletAPACFixed Income BulletsAustraliaMarkets

ACGBs (YM -2.0 & XM -0.5) are weaker and near session cheaps after today’s mixed domestic data.

  • At face value, the retail sales data suggested some positive impact from the government's tax cuts/costs of living relief measures. The ABS also noted: “This year was the warmest August since 1910, which saw more spending on items typically purchased in spring.”
  • Concerning building approvals: "The movements in dwellings excluding houses continue to be the result of volatility in apartment approvals, with the broad environment around apartments remaining subdued," said Daniel Rossi, ABS.
  • Cash US tsys are flat to 1bp richer in today’s Asia-Pac session.
  • Cash ACGBs are cheaper with the belly underperforming. The AU-US 10-year yield differential at +22bps.
  • Swap rates are 1-3bps higher, with the 3s10s curve flatter.
  • The bills strip is cheaper, with pricing -3 to -5 across contracts.
  • RBA-dated OIS pricing sits 1-4bps firmer across meetings. Notably, pricing for 2025 meetings is now 2-4bps higher than pre-RBA levels on September 24.
  • For context, these same meetings were 6-10bps softer compared to pre-RBA levels the day after the decision.
  • Tomorrow, the local calendar is empty, apart from the AOFM’s planned sale of A$800mn of the 2.75% 21 June 2035 bond.
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ACGBs (YM -2.0 & XM -0.5) are weaker and near session cheaps after today’s mixed domestic data.

  • At face value, the retail sales data suggested some positive impact from the government's tax cuts/costs of living relief measures. The ABS also noted: “This year was the warmest August since 1910, which saw more spending on items typically purchased in spring.”
  • Concerning building approvals: "The movements in dwellings excluding houses continue to be the result of volatility in apartment approvals, with the broad environment around apartments remaining subdued," said Daniel Rossi, ABS.
  • Cash US tsys are flat to 1bp richer in today’s Asia-Pac session.
  • Cash ACGBs are cheaper with the belly underperforming. The AU-US 10-year yield differential at +22bps.
  • Swap rates are 1-3bps higher, with the 3s10s curve flatter.
  • The bills strip is cheaper, with pricing -3 to -5 across contracts.
  • RBA-dated OIS pricing sits 1-4bps firmer across meetings. Notably, pricing for 2025 meetings is now 2-4bps higher than pre-RBA levels on September 24.
  • For context, these same meetings were 6-10bps softer compared to pre-RBA levels the day after the decision.
  • Tomorrow, the local calendar is empty, apart from the AOFM’s planned sale of A$800mn of the 2.75% 21 June 2035 bond.