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Cheaper As Claims Data Pressures US Tsys, Adds To Post-Jobs Sell-Off


ACGBs (YM -6.0 & XM -7.5) are cheaper after initial jobless claims came in at 228k, below market expectations of circa 240k. The weekly claims data has been the latest print to highlight the resilience of the US economy. Cash US tsys finished 7-11bps cheaper across the major benchmarks with the belly leading.

  • The NASDAQ dropped -2.05% after disappointing Netflix and Tesla news.
  • Cash ACGBs opened 5-7bp cheaper with the AU-US 10-year yield differential -2bp at +17bp.
  • Swap rates are 5-7bp higher with the 3s10s curve flatter.
  • The bills strip bear steepens with pricing -2 to -8.
  • RBA-dated OIS pricing is 1-6bp firmer across meetings.
  • A 67% chance of a 25bp hike is now priced for August versus 40% before yesterday's jobs data.
  • (AFR) The strong jobs market is ensuring households can cope with surging borrowing and living costs. That’s why Westpac chief executive Peter King says jobs data is the most important indicator in the economy right now. While King says there is no shortage of households doing it tough, it’s strong employment that is underpinning spending and preventing the pain we might have expected to see among borrowers after the fastest interest rate-raising cycle in living memory. (See link)
  • Today the local calendar sees no data releases, with the focus on next Wednesday's CPI.

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