Cheaper, UST 10Y Supply Well Received, Tap Of TCorp Feb-30 & Mar-31 Bonds

ACGBs (YM -3.0 & XM -4.0) are weaker after US tsys cheapened 2-3bps across the curve. In the absence of first-tier US economic data, trading ranges were narrow. US tsys pared weakness following a decent $42B 10Y sale stopped 1.2bp through: 4.093% high yield vs. 4.105% WI; 2.56x bid-to-cover steady to prior.

• The S&P 500 achieved another record intraday high and is closing in on the psychological 5,000 level.
• Elsewhere, German industrial production fell for the seventh consecutive month in December. This is the longest-ever downturn, exceeding the global financial crisis.
• Nevertheless, ECB Schnabel pushed back against the prospect of near-term rate cuts in an interview with the FT, citing sticky services inflation, a resilient labour market, a loosening in financial conditions and tensions in the Red Sea.
• Cash ACGBs are 3-4bps cheaper, with the AU-US 10-year yield differential unchanged at +1bp.
• Swap rates are 2-4bps higher, with the 3s10s curve steeper.
• The bills strip has bear-steepened, with pricing flat to -4.
• RBA-dated OIS pricing is flat to 2bps softer across meetings. A cumulative 45bps of easing is priced by year-end.
• Today, the local calendar is empty.
• TCorp has announced its intention to auction A$500mn of its existing 3.00% Feb-30 and 2.00% Mar-31 benchmark bonds. Bids will be accepted via Yieldbroker from 10:45 to 11:00 local time.