Narrow Ranges, US Tsy Futures Slightly Cheaper

ACGBs (YM +2.0 & XM -0.5) have maintained their twist-steepening throughout the Sydney session after dealing with relatively narrow ranges. Today’s domestic data drop failed to provide a market-moving catalyst.

• In addition to the previously outlined inflation gauge and job ads data, CBA household spending data showed a 3.1% y/y rise (-3.9% m/m) in December.
• US tsy futures are slightly weaker in today’s Asia-Pac session, with newsflow light. Cash US tsys are closed today for observance of the Martin Luther King Day public holiday.
• Cash ACGBs have twist-steepened too, yields 2bps lower to 1bp higher. The AU-US 10-year yield differential is 4bps wider at +14bps.
• Swap rates are flat to 3bps lower, with the 3s10s curve steeper.
• The bills strip is richer, with pricing flat to +4, reds leading.
• RBA-dated OIS pricing is 1-2bps softer across meetings beyond February, with December leading.
• Tomorrow, the local calendar sees Westpac Consumer Confidence.
• On Wednesday, the AOFM plans to sell A$800mn of the 3.50% 21 December 2034.
• ICYMI, TCV has launched a new A$-denominated Sep-38 fixed-rate benchmark bond, UBS said. Bond initial price guidance of EFP+115-119bps, equating to ACGB 3.75% 21 Apr-37 +103.4-107.4bps. Pricing is expected to take place tomorrow.