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MNI China Daily Summary: Friday, March 24

MNI BRIEF: Taiwan Unemployment Up Slightly In February

MNI: PBOC Net Drains CNY173 Billion via OMOs Friday

MNI: UK MAR FLASH MANUF PMI 48.0 (FCST 49.7); FEB 49.3

PMI: Growth outside Germany and France strongest

MNI: EUROZONE MAR FLASH MANUF PMI 47.1 (FCST 49.0); FEB 48.5

MNI BRIEF: Yellen Says Americans' Deposits Are Safe

MNI BRIEF: Italy ESM Ratification Framed In EU’s Fiscal Debate

MNI: Freeland-Banks Well Capitalized, Budget To Focus Stimulus

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Early Steepening Holds, Relative Underperformance Extends

AUSSIE BONDS
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ACGBs adjusted cheaper after the Christmas break, softening in lieu of weakness in core global FI markets that came on the back of the latest reopening push in China (with most of the focus on the wind back of international travel restrictions/limitations) and some hawkish ECB speak.

  • The space went out just above worst levels, with YM -19.0 & XM -21.5, while wider cash ACGB trade saw 15-21bp of cheapening as the curve bear steepened.
  • ACGBs extended their recent run of underperformance vs. their global counterparts, with the AU/U.S. 10-Year yield spread briefly moving out beyond +20bp, before finishing off extremes, albeit still comfortably wider than late Friday levels.
  • There wasn’t anything in the way of meaningful domestic/idiosyncratic headline flow.
  • The local docket is empty in the time between Christmas and the New Year, which will leave broader macro headlines and spill over from wider cross-market flows at the fore in the coming days.
  • Meanwhile, expect volumes and general liquidity to be limited as many participants will take time off between Christmas and NY.
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ACGBs adjusted cheaper after the Christmas break, softening in lieu of weakness in core global FI markets that came on the back of the latest reopening push in China (with most of the focus on the wind back of international travel restrictions/limitations) and some hawkish ECB speak.

  • The space went out just above worst levels, with YM -19.0 & XM -21.5, while wider cash ACGB trade saw 15-21bp of cheapening as the curve bear steepened.
  • ACGBs extended their recent run of underperformance vs. their global counterparts, with the AU/U.S. 10-Year yield spread briefly moving out beyond +20bp, before finishing off extremes, albeit still comfortably wider than late Friday levels.
  • There wasn’t anything in the way of meaningful domestic/idiosyncratic headline flow.
  • The local docket is empty in the time between Christmas and the New Year, which will leave broader macro headlines and spill over from wider cross-market flows at the fore in the coming days.
  • Meanwhile, expect volumes and general liquidity to be limited as many participants will take time off between Christmas and NY.