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Cheaper, Narrow range, Tracking Tsys

AUSSIE BONDS

ACGBs (YM -3.0 & XM -3.0) are weaker, after dealing in a relatively narrow range in the Sydney session. With the local calendar light today, local participants have been guided by US tsys.

  • US tsys sit little changed across the major benchmarks in Asia-Pac trading. In early dealings on Tuesday US tsys were pressured as participants perhaps looked ahead to Fed Chair Powell's speech at the Jackson Hole Symposium on Friday. A Bloomberg Market Pulse Survey noted that 80% of those surveyed said the speech will reinforce the message of a hawkish hold.
  • Cash ACGBs are 2-3bp cheaper, with the AU-US 10-year yield differential 2bp tighter at -5bp.
  • Swap rates are 2bp higher, with EFPs 1bp tighter.
  • The bills strip has bear steepened, with pricing -1 to -4.
  • RBA-dated OIS pricing is little changed across meetings.
  • Tomorrow the local calendar sees the only economic release of the week, namely Judo Bank’s PMI data.
  • Tomorrow the AOFM plans to sell A$700mn of the 3.00% 21 November 2033 bond.
  • (AFR) Retailers, builders and cafe owners are more likely than other company directors to default on their credit cards and home loans, missing payments to keep their embattled businesses afloat. (See link)

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