Low Conviction, AOFM Matters Eyed

Much like U.S. Tsys, the ACGB space isn't going anywhere fast, with no impetus drawn from today's local data releases, while the presence of the latest round of scheduled ACGB purchases (covering maturities of Nov '28 to May '32) is likely providing an underlying bid to that area of the curve. YM -0.5, while XM is unch. on the day.

• A quick reminder that our policy team's latest RBA insight piece (published during the London morning on Wednesday) highlighted their understanding that "fresh Covid-19 outbreaks and the slow pace of Australia's vaccine rollout are having more of an impact on the economy than the Reserve Bank of Australia expected when it made its most recent forecasts in May, weighing on its calculations as it considers an extension of its yield guidance." The clear market consensus is that the RBA chooses NOT to roll its 3-Year yield target over to ACGB Nov '24 from ACGB Apr '24 at its July meeting.
• Looking ahead to Friday, housing finance data, A$1.0bn of ACGB 0.25% 21 November 2025 supply and the AOFM's more detailed guidance on issuance plans for FY21/22 are set to headline locally.