YM was happy to operate in the bottom half of its overnight session range during the first Sydney session of the week, while XM extended on post-settlement losses as we moved through the day. That leaves YM -12.0 & XM -14.0 as we move towards the bell, with the 10- to 15-Year sector of the ACGB curve providing the weakest point in wider cash trade. 10-Year ACGB yields tagged a fresh cycle high, breaching 3.25%.
- The wider tone was set by Friday’s U.S. Tsy-driven post-Sydney losses, with expectations re: RBA lift off at Tuesday’s meeting capping the early uptick.
- Both the 3- & 10-Year EFPs have tightened by ~2bp as of typing.
- There was no reaction in the space to the M/M dip in Melbourne Institute inflation expectations (-0.1%), while the Y/Y reading cooled a little (to 3.4% from the multi-year high of 4.0% observed in March). The space was back from best levels ahead of the prints, with no subsequent bid emerging.
- ANZ Job Ads dropped by 0.5% in April, although the measure remains 57.3% above the pre-pandemic level, with the data collator noting that “labour market conditions are very tight.”
- Focus is squarely on Tuesday’s RBA decision (the MNI markets team leans towards a 15bp rate hike come the end of tomorrow’s meeting, expect our full preview of the event to be released during the London morning).