Futures Hold Most Of Overnight Losses, CPI To Headline This Week

Aussie bonds futures operate marginally above levels seen at the close of the final overnight session of last week, with YM -4.0 & XM -4.5 after generally tracking U.S. Tsys ahead of the weekend (albeit with weakness in Tsys more pronounced than that in ACGB futures). That leaves YM -4.0 & XM -4.5. Meanwhile, wider cash ACGB trade sees 4-5bp of cheapening, with very modest bear steepening observed.

• Bills are 1-5bp cheaper through the reds.
• RBA dated OIS is still showing just under 20bp of tightening for next month’s meeting, while terminal cash rate pricing continues to operate around the 3.55% mark.
• A reminder that the LNY holiday period will thin out broader liquidity during Asia-Pac hours to varying degrees throughout the week.
• Wednesday’s Q4 CPI data headlines this week’s domestic docket, and will be supplemented by PPI, terms of trade, the monthly NAB business survey, Westpac leading index and Judo Bank flash PMIs. It is also worth noting that Australian markets will be closed on Thursday for the Australia Day holiday.