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Aussie bonds struggled to extend.......>

AUSSIE BONDS
AUSSIE BONDS: Aussie bonds struggled to extend through the overnight high for
most of the session, but were supported by the broader caution surrounding
Coronavirus, as a late push saw contract shut at best levels. YM +4.0, XM +6.5.
Curve flattened, perhaps YM needs a little more RBA cut re-pricing to push
higher. This morning's flash CBA PMIs saw series lows for both the composite &
services prints, as both dived below 50.0. The notes that accompanied the
release stated that the PMIs "imply a contraction in private demand. Whilst this
is clearly a disappointing result, it is not altogether surprising given the two
exogenous shocks that have hit the Australian economy - the bushfires and the
coronavirus. Our main concern is that these events have hit the global and local
economies at a time when domestic demand was already soft. The level of both the
services and manufacturing PMIs highlights the need for more policy stimulus.
With monetary policy doing most of the heavy lifting an easing in fiscal policy
continues to look the most appropriate response to support aggregate demand."
- In semis, NTTC priced A$700mn of new Apr 2031s at EFP +93.
- Bills were 1-5 ticks lower through the reds at close.
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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