Give Back Some Of Yesterday's Rally As U.S. Tsys Weaken

ACGBs remain weaker on the day, holding near session lows after extending on their pullback from the knee-jerk session highs registered on the release of RBA Governor Lowe's initial remarks. YM -4.0 & XM -2.0 as a result.

• The space has given back some of yesterday’s strength after Fed Chair Powell’s hawkish testimony to Congress, further aided by some modest U.S. Tsy weakness in early Asia-Pac trade (regional reaction to Powell).
• To recap, Lowe provided a look behind the thought process at the RBA, noting that the Bank is nearer to a pause, highlighting its data-dependent stance and completely open mind ahead of the April meeting. This chimed with the general post-meeting train of thought, providing little in the way of actionable ideas.
• Cash ACGBs are 2-4bp weaker with the 3/10 curve 2bp flatter.
• The AU/US cash 10-year yield differential is ucnhanged at -27bp, just above the cycle low of ~-30bp. The signaling from the RBA over the last day or so vs. Powell's messaging remains the driving factor here, allowing the spread to hold just above cycle tights.
• RBA terminal rate pricing is incrementally firmer on the day, likely aided by feedthrough from Fed pricing post-Powell.