Early Losses More Than Unwound On Soft Data & Chinese COVID Matters

The overnight cheapening in Aussie Bond futures more than reversed as the session wore on, with the previously covered COVID situation in China (another round of record daily news cases and pockets of social unrest showing up across some of the major Chinese cities) coupling with soft local data (a surprise fall in retail sales) to provide the bid in the space.

• That left YM +7.0 & XM +6.0 at the bell, with 3-7bp of richening witnessed across the major cash ACGB benchmarks, as the curve bull steepened.
• Parliamentary comments from RBA Governor Lowe failed to move the needle, with familiar lines of questioning and answers provided.
• Elsewhere, we note that Anna Hughes, the Deputy Under Treasury for South Australia, was appointed as the new head of the Australian Office of Financial Management (AOFM).
• Bills were 4-9bp richer through the reds, bull flattening, more once again more than reversing early losses. RBA dated OIS eased a touch on the session, but the major metrics stuck within the recently observed ranges.
• Tomorrow’s thin local docket will be headlined by the weekly ANZ-Roy Morgan consumer confidence index.