Moves in Aussie bond futures have mirrored that observed in U.S. TY futures, with shallow looks below overnight session lows, before a tick away from worst levels. There hasn’t been much in the way of notable macro news flow to drive wider price action thus far, leaving the space in a fairly tight range, trading at the whim of broader core global FI sentiment. YM & XM last -7.5, while cash ACGB trade sees a parallel cheapening shift across the curve. EFPs are a touch wider on the day, with the 3-/10-Year box steepening a little. In terms of RBA pricing, the IB strip currently prices in 36bp of tightening come the end of the Bank’s June meeting, with a year-end cash rate of ~2.85% currently priced.
- The latest opinion polls continue to show the incumbent coalition chipping away at Labor’s lead ahead of Saturday’s Federal election, but will it be a case of too little, too late? Most polls indicate that will be the case, with a marginal Labor majority generally projected.
- A$800mn of ACGB Nov-32 supply is due at the top of the hour, with Q1 WPI data due in ~40 minutes.