Flat, Typical Pre-US Payrolls Friday

ACGBs (YM flat & XM +1.0) are dealing flat but ranges have been narrow in a typical pre-US Payrolls Friday. The local calendar has been empty so far, with Foreign Reserves data due soon.

• Cash US tsys are dealing flat to 1bp richer, with a steepening bias, ahead of tonight’s Non-Farm Payrolls release. (See MNIs Payroll Preview here)
• Cash ACGBs are flat to 1bp richer, with the AU-US 10-year yield differential at +5bps.
• Swap rates are flat to 1bp lower, with the 3s10s curve flatter.
• Bill strip pricing is flat.
• RBA-dated OIS pricing is little changed across meetings. Terminal rate expectations sit at 4.49%.
• The latest round of ACGB May-28 supply extended the recent trend of firm pricing at ACGB auctions, with the cover ratio rising to 4.0778x.
• QTC priced an A$1.5bn increase of QTC 5.25% 21 Jul-36 bond. The transaction has a re-offer spread of 100bps over the 10-year futures contract, equating to 90.5ps over the ACGB 3.75% 21 April 2037.
• Next week, the local calendar will see Home Loans data on Monday and Consumer and Business Confidence on Tuesday.
• The AOFM plans to sell A$700mn of the 3.75% 21 May 2034 bond on Wednesday and A$800mn of the 2.75% 21 November 2029 bond on Friday.