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Cheaper With US Tsys, Nov-28 Supply Due

AUSSIE BONDS
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ACGBs (YM -6.0 & XM -5.0) are cheaper after US tsys were pressured by higher than expected flash PMIs: Services PMI (54.8 vs. 51.2 est) and Composite PMI (54.4 vs. 51.2 est) while Manufacturing PMI slightly higher (50.9 vs. 49.9 est). Weekly claims were also lower than expected at 215k vs. 220k est, prior revised to 223k from 222k.

  • US tsy yields finished up 4-6bps across benchmarks. The 10-year rate was up 5bps at 4.48%.
  • US STIR is back to pricing just 35bps of cuts this year, with November no longer fully priced.
  • The flash data sapped the early risk-on tone with S&P Eminis and Nasdaq indexes marking new all-time highs before extending lows amid several rounds of program selling/profit taking ahead of the extended Memorial holiday weekend. Nvidia rose 9.3%, lifting its market cap to $US2.55 trillion.
  • Cash ACGBs are 5-6bps cheaper with the AU-US 10-year yield differential at -16bps.
  • Swap rates are 4bps higher, with EFPs tighter.
  • The bills strip has bear-steepened, with pricing -1 to -5.
  • RBA-dated OIS pricing is 2-4bps firmer for 2025 meetings. Only 6bps of easing is priced by year-end.
  • Today, the local calendar is empty apart from the AOFM’s planned sale of A$900mn of the 2.75% Nov-28 bond.
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ACGBs (YM -6.0 & XM -5.0) are cheaper after US tsys were pressured by higher than expected flash PMIs: Services PMI (54.8 vs. 51.2 est) and Composite PMI (54.4 vs. 51.2 est) while Manufacturing PMI slightly higher (50.9 vs. 49.9 est). Weekly claims were also lower than expected at 215k vs. 220k est, prior revised to 223k from 222k.

  • US tsy yields finished up 4-6bps across benchmarks. The 10-year rate was up 5bps at 4.48%.
  • US STIR is back to pricing just 35bps of cuts this year, with November no longer fully priced.
  • The flash data sapped the early risk-on tone with S&P Eminis and Nasdaq indexes marking new all-time highs before extending lows amid several rounds of program selling/profit taking ahead of the extended Memorial holiday weekend. Nvidia rose 9.3%, lifting its market cap to $US2.55 trillion.
  • Cash ACGBs are 5-6bps cheaper with the AU-US 10-year yield differential at -16bps.
  • Swap rates are 4bps higher, with EFPs tighter.
  • The bills strip has bear-steepened, with pricing -1 to -5.
  • RBA-dated OIS pricing is 2-4bps firmer for 2025 meetings. Only 6bps of easing is priced by year-end.
  • Today, the local calendar is empty apart from the AOFM’s planned sale of A$900mn of the 2.75% Nov-28 bond.