NZGBS: A Touch Firmer To Start, Weekly Supply Eyed

NZGB yields are little changed to 1bp lower, with some light richening in U.S. Tsys feeding through. Swap rates are a couple of bp lower across the curve.

• RBNZ-dated OIS continues to show somewhere between 55-60bp of tightening for this month’s meeting, with terminal OCR pricing holding just above 5.25%.
• Local headline flow has seen the latest BNZ-SEEK employment report highlight that “the 2% rebound in job ads in January was intriguing. After all, it followed a clear downward trajectory over the last 4 months of 2022, when ad numbers logged a cumulative drop of around 20%. In this context, it’s hard to conclude January’s jump as being significant. The national trend is still in decline. And it’s difficult to believe it will rev back up, when many of New Zealand’s leading economic indicators, including for the labour market now, are wavering. That said, January’s bounce in job ads does make it interesting to see what next months’ outcomes deliver.”
• Meanwhile, the RBNZ is seeking feedback on the second stage of its liquidity policy review. Full details can be seen here.
• This may result in the tightening of eligibility criteria surrounding “liquid assets.”
• The weekly round of NZGB supply headlines the remainder of today’s domestic docket, covering NZGB-27, -34 and -51.