Cheaper, Light Local Calendar, Market Awaits Jackson Hole Speeches

ACGBs (YM -4.0 & XM -3.5) are weaker after US tsys finished 3-6bp cheaper across the major benchmarks. The curve flattened. US tsys were pressured in the European session as participants looked ahead to Fed Chair Powell's remarks this evening at the Jackson Hole Symposium. The market awaits any signals on the path of US monetary policy.

• Prior to the Jackson Hole symposium, central bank policymakers have conveyed a blend of perspectives. Taking a more hawkish stance, Boston Fed's Collins emphasised the prudence of maintaining elevated rates for an extended duration, underlining the potential necessity for further adjustments. Collins stated, "A preset path may not be conducive; additional increments might be necessary, and we could be on the cusp of a prolonged period of stability." Conversely, Philly Fed's Harker indicated to MNI that he leans towards endorsing the maintenance of prevailing interest rates until the conclusion of the year and potentially even beyond.
• Cash ACGBs opened 3bp cheaper with the AU-US 10-year yield differential -3bp at -9bp.
• Swap rates are 4bp higher.
• The bills strip has bear-steepened, with pricing -1 to -6.
• RBA-dated OIS pricing is 2-4bp firmer for '24 meetings. A 6% chance of a 25bp hike is priced for September.
• Today the local calendar is empty.