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Flat To A Touch Lower To Start

AUSSIE BONDS

Aussie bond futures are flat to a touch lower in early Sydney trade, with the threat of higher oil prices stemming from geopolitical worry re: Iran & Israel, along with the risk of a fresh round of inflationary pressure across the Tasman in lieu of notable rainfall in the Auckland area, weighing.

  • This comes after futures corrected from post-Sydney session cheaps ahead of the weekend, in sympathy with a move in U.S. Tsys that came after U.S. data.
  • YM trades -1.0 as a result, while XM is -2.0. Wider cash ACGB trade sees the major benchmarks running flat to 2bp cheaper with the 7- to 20-Year zone leading the weakness.
  • Bills sit -2 to +1 through the reds, while RBA dated OIS is showing ~24bp of tightening for next month’s meeting, alongside a terminal cash rate of ~3.80%, little changed to a touch above Friday’s late levels.
  • Looking ahead, A$300mn of ACGB May-41 supply and the return of Chinese market participants after the LNY break are set to provide the highlights on Monday.
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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