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Bull Steepening Still, But Off Extremes

AUSSIE BONDS

Aussie bonds trade in a relatively contained fashion over the latest BoJ decision, with nothing in the way of BoJ surprises noted as Governor Kuroda’s tenure nears its conclusion (this was his last monetary policy meeting atop the central bank).

  • YM hasn’t managed to challenge its early Sydney highs, +10.2 last, while XM managed to register a marginal fresh session high in lieu of the BoJ decision before nudging back from best levels to last trade +9.8. Cash ACGBs run 5.5-9.5bp richer, with the bull steepening moving back from session extremes, but still prevailing.
  • Futures roll volume continues to tick over, with XM rolls still trading heavily on the bid. YM is a little more balanced, still, more has traded on the bid than the offer (57/43 split)
  • Next week’s AOFM issuance slate holds a steady A$1.0bn issuance rate for ACGBs, with the debt agency looking to build ACGB May-34 up to size given its inclusion in the XMM3 basket (the remainder of the basket bonds have A$20.4-A$39.3bn on issue at present vs. the A$16.6bn that will be on issue for ACGB May-34 after next week’s auction).
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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