Cheaper, Limited Reaction To RBA Bullock, NZGB Sell-Off Largely Ignored

ACGBs (YM -3.0 & XM -1.5) are cheaper and in the middle of today’s Sydney session ranges. There was limited market reaction to RBA Governor Bullock's appearance before the House of Reps Economics Committee.

• (BBG) Australia’s central bank won’t wait for inflation to return to the midpoint of its 2-3% target before cutting interest rates, Governor Michele Bullock told a parliamentary panel on Friday, suggesting the board is open to beginning an easing cycle later this year. (See link)
• Apart from Governor Bullock’s comments, local participants have likely eyed US tsys in today’s Asia-Pac session for directional guidance. To that end, US tsys are currently dealing flat to 1bp richer across benchmarks. News flow has been light so far today.
• ACGBs looked past the sharp sell-off in NZGBs following ANZ's hawkish OCR call change.
• Cash ACGBs are 1-2bps cheaper, with the AU-US 10-year yield differential 4bps tighter at -3bps.
• Swap rates are 1-3bps higher, with the 3s10s curve flatter.
• Bills pricing is -1 to -4, with the strip steeper.
• RBA-dated OIS pricing is flat to 4bps firmer. A cumulative 43bps of easing is priced by year-end.
• The local calendar is empty on Monday.
• The AOFM plans to sell A$800mn of 1.00% Dec-30 bond on next Wednesday.