Firmer & Steeper After U.S. CPI

YM probes its overnight high, while XM has extended through its own post-Sydney peak, as Sydney participants react to the softer than expected U.S. CPI data. Cash ACGBs run 12-19bp richer across the curve, with bull steepening in play.

• Bills run 7-24bp richer through the reds, bull flattening, with RBA dated OIS adjusting lower as terminal cash rate pricing moves in to ~3.70%. In the more immediate term, ~19bp of tightening is now priced for next month’s RBA.
• In local news flow, PM Albanese has noted that the government is open to considering all measures in light of surging energy prices, including introducing a price cap on gas, although he ruled out the introduction of a mining tax.
• The release of the weekly AOFM issuance slate headlines the domestic docket today, which will leave post-U.S. CPI adjustments and cross-market gyrations at the fore, barring the appearance of any meaningful headline flow.