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Bonds Bid As Cash Rate Pricing Pulls Lower In Lieu Of NZ CPI

AUSSIE BONDS

Continued trans-Tasman feedthrough from the NZ CPI data results in a bid in ACGBs, leaving YM +12.0 & XM +11.0, with cash ACGBs running 11.0-12.5bp richer across the curve as 3s lead the way.

  • Bills are 4-11bp richer through the reds, with a flattening bias observed.
  • RBA dated OIS has continued to come in in the wake of the NZ CPI print (as well as a subsequent adjustment lower in RBNZ dated OIS, as some sell-side names pencil in a 50bp hike at next month’s RBNZ meeting vs. 75bp previously), now showing a terminal RBA cash rate below 3.50%.
  • Swaps lag the moves in bonds, with EFPs a touch wider on the day.
  • All eyes are on Q4 & Dec CPI data, which will cross at the bottom of the hour.
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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