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Nov-32 I/L Supply Goes Very Well

AUSSIE BONDS

The latest round of Nov-32 I/L supply was easily absorbed, with the weighted average yield printing 3.27bp through prevailing mids (per Yieldbroker), while the cover ratio ticked higher to 2.56x (from 2.44x at the previous auction), aided by well-documented worry surrounding the current inflationary backdrop.

  • A reminder that breakevens point to market participants having faith in the RBA when it comes to bringing inflation back down to levels within its target band in the medium- to longer-term, with the bank continuing to emphasise its resolve re: keeping inflation expectations anchored.

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