Cheaper Ahead Of WPI & RBA Minutes

ACGBs (YM -6.0 & XM -4.0) are weaker after the US tsys bear flattened in the NY session. The 10-year US tsy yield briefly pushed to a new high for the year of 4.21%, before finishing at 4.19%, up 4bp for the day.

• More than $1.8 billion came out of the $39 billion iShares 20+ Year Treasury Bond ETF (ticker TLT) last week, the most since March 2020, data compiled by Bloomberg show. (See link)
• The Australian Securities Exchange June report that fixed income ETFs listed on the ASX were managing more than $17.6 billion of investors’ assets, as at June 30, 2023 – a 16.8 per cent increase in six months. (See link)
• Cash ACGBs opened 4-5bp cheaper with the AU-US 10-year yield differential 1bp wider at +4bp.
• Swap rates are 3-5bp higher, with the 3s10s curve flatter.
• The bills strip bear steepens with pricing -2 to -7.
• RBA-dated OIS pricing is flat to 5bp firmer across meetings, with mid-'24 leading.
• Today the local calendar sees RBA Minutes for the August meeting and the highly significant Wage Price Index. Wages lifted a softer-than-expected 0.8% q/q (+3.7% y/y) in March. Consensus expects +0.9% q/q and +3.7% y/y. The July Employment report is out on Thursday.