MNI China Daily Summary: Wednesday, October 16

MNI: ITALY FINAL HICP +1.2% M/M, +0.7%Y/Y

MNI BRIEF: BOJ's Adachi Sees Conditions For Normalisation

MNI: PBOC Net Injects CNY581.4 Bln via OMO Wednesday

CHINA PBOC CONDUCTS CNY642.4 BLN VIA 7-DAY REVERSE REPOS WEDS

MNI: PBOC Sets Yuan Parity Higher At 7.1191 Weds; +2.66% Y/Y

MNI: UK SEP OUTPUT PPI -0.5% M/M, -0.7% Y/Y

MNI: UK SEP CPI +0% M/M, +1.7% Y/Y

Japan Aug Machine Orders -1.9% M/M

CANADA: Politics Week: Trudeau Faces More Pressure To Resign

CANADA: Politics Week: Parliament Opens With Early Election Threats

AUSTRALIA: Albanese Lines Up Budget for May Election

© 1982-2024 MNI. All rights reserved.
Terms | Privacy
Log Out
Free Trial

BONDS: NZGBS: Closed Richer & At Session Bests After Q3 CPI Miss

BONDS
BulletMarketsFixed Income Bullets

NZGBs closed 3-5bps richer across benchmarks on the day, 2-4bps richer than pre-CPI levels. 

  • Q3 NZ CPI came in slightly below forecasts at 0.6%q/q (mkt consensus was 0.7%, while the RBNZ projected a 0.8% rise). The Q2 outcome was 0.4%. In y/y terms inflation was 2.2%, in line with market expectations, while the RNZ projected a 2.3% rise.
  • Annual headline inflation is back within the RBNZ's 1-3% target band for the first time since early 2021. Non-tradabables inflation, a measure of domestic price pressures is still quite elevated in y/y terms, back to 4.9% for Q3. This is comfortably above longer-term averages.
  • Still, measures of core inflation like the trimmed mean eased to 2.5%y/y in Q3 from 3.7%, while the weighted median was at 2.8% y/y in Q3 from 3.5% prior.
  • Swap rates closed 4-7bps lower, with the 2s10s curve steeper.
  • RBNZ dated OIS pricing is 2-5bps softer after the CPI data and 5-9bps softer on the day across meetings. 58bps of easing is priced for the November meeting, with a cumulative 99bps by February.
  • Tomorrow, the local calendar is empty apart from the NZ Treasury’s planned sale of NZ$175mn of the 1.50% May-31 bond, NZ$250mn of the 4.25% May-34 bond and NZ$75mn of the 1.75% May-41 bond.
206 words

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.

NZGBs closed 3-5bps richer across benchmarks on the day, 2-4bps richer than pre-CPI levels. 

  • Q3 NZ CPI came in slightly below forecasts at 0.6%q/q (mkt consensus was 0.7%, while the RBNZ projected a 0.8% rise). The Q2 outcome was 0.4%. In y/y terms inflation was 2.2%, in line with market expectations, while the RNZ projected a 2.3% rise.
  • Annual headline inflation is back within the RBNZ's 1-3% target band for the first time since early 2021. Non-tradabables inflation, a measure of domestic price pressures is still quite elevated in y/y terms, back to 4.9% for Q3. This is comfortably above longer-term averages.
  • Still, measures of core inflation like the trimmed mean eased to 2.5%y/y in Q3 from 3.7%, while the weighted median was at 2.8% y/y in Q3 from 3.5% prior.
  • Swap rates closed 4-7bps lower, with the 2s10s curve steeper.
  • RBNZ dated OIS pricing is 2-5bps softer after the CPI data and 5-9bps softer on the day across meetings. 58bps of easing is priced for the November meeting, with a cumulative 99bps by February.
  • Tomorrow, the local calendar is empty apart from the NZ Treasury’s planned sale of NZ$175mn of the 1.50% May-31 bond, NZ$250mn of the 4.25% May-34 bond and NZ$75mn of the 1.75% May-41 bond.