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Edges Down From Multi Week Highs

BONDS

NZGBs Hold Firm

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Futures Testing Lows, Curve Holding Steeper

AUSSIE BONDS

No tangible reaction in bonds to the slightly firmer than expected domestic retail sales data for August (+0.6% M/M vs. BBG Median +0.4%), with YM testing its overnight/Sydney lows & XM looking through its own Sydney/overnight extremes, as the steepening impetus on the wider curve holds with global demand for duration limited at best at present.

  • Taking a look at the details of the retail sales data, it sounded like the headline was driven by a mix of rotation back towards normal life continuing i.e. cafe & restaurant spending moving higher, in addition to inflation impacting essentials such as food. Non-food spending was little changed on net.
  • Elsewhere, the final Australia underlying deficit for FY21/22 came in at -A$32.0bn, roughly in line with the positive adjustments flagged by the Treasurer in recent weeks.
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No tangible reaction in bonds to the slightly firmer than expected domestic retail sales data for August (+0.6% M/M vs. BBG Median +0.4%), with YM testing its overnight/Sydney lows & XM looking through its own Sydney/overnight extremes, as the steepening impetus on the wider curve holds with global demand for duration limited at best at present.

  • Taking a look at the details of the retail sales data, it sounded like the headline was driven by a mix of rotation back towards normal life continuing i.e. cafe & restaurant spending moving higher, in addition to inflation impacting essentials such as food. Non-food spending was little changed on net.
  • Elsewhere, the final Australia underlying deficit for FY21/22 came in at -A$32.0bn, roughly in line with the positive adjustments flagged by the Treasurer in recent weeks.