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AUSSIE BONDS: Yields Higher After Hotter Than Expected US Core CPI

AUSSIE BONDS
RegionGlobalBulletAPACFixed Income BulletsAustraliaMarkets

In roll-impacted dealings, ACGBs (YM -5.0 & XM -2.6) are cheaper after US CPI data drove US tsy yields higher and the curve flatter. The 2-year was 5bps higher at 3.64% after hitting a new 2-year low earlier in the session. The 10-year was up 1bp at 3.65% in spite of a very successful auction. The curve closed in positive territory for a fourth straight day. 

  • US Core CPI surprised higher in August on a housing inflation rebound, rising 0.281% last month against expectations for a 0.2% increase. The annual rates for Headline and Core CPI were 2.5% and 3.2% respectively.
  • After dropping over -1.0% in early trading, US equities surged on dip buying.  The NASDAQ advanced ~2%, with the S&P 500 closing with a 1% gain.
  • The focus now turns to today's US PPI and Weekly Claims data.
  • Cash ACGBs are 2-5bps cheaper, with the AU-US 10-year yield differential at +22bps.
  • Swap rates are 1-4bps higher, with the 3s10s curve flatter.
  • The bills strip is cheaper, with pricing -2 to -4 across contracts.
  • RBA-dated OIS pricing is flat to 6bps firmer, with early 2025 leading. A cumulative 16bps of easing is priced by year-end.
  • Today, the local calendar will see Consumer Inflation Expectation data.
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In roll-impacted dealings, ACGBs (YM -5.0 & XM -2.6) are cheaper after US CPI data drove US tsy yields higher and the curve flatter. The 2-year was 5bps higher at 3.64% after hitting a new 2-year low earlier in the session. The 10-year was up 1bp at 3.65% in spite of a very successful auction. The curve closed in positive territory for a fourth straight day. 

  • US Core CPI surprised higher in August on a housing inflation rebound, rising 0.281% last month against expectations for a 0.2% increase. The annual rates for Headline and Core CPI were 2.5% and 3.2% respectively.
  • After dropping over -1.0% in early trading, US equities surged on dip buying.  The NASDAQ advanced ~2%, with the S&P 500 closing with a 1% gain.
  • The focus now turns to today's US PPI and Weekly Claims data.
  • Cash ACGBs are 2-5bps cheaper, with the AU-US 10-year yield differential at +22bps.
  • Swap rates are 1-4bps higher, with the 3s10s curve flatter.
  • The bills strip is cheaper, with pricing -2 to -4 across contracts.
  • RBA-dated OIS pricing is flat to 6bps firmer, with early 2025 leading. A cumulative 16bps of easing is priced by year-end.
  • Today, the local calendar will see Consumer Inflation Expectation data.