NZGBS: At Cheaps, NZDM Announcement Weighs, NZ/AU 10-Year Differential Wider

NZGBs closed at or just off session cheaps, 1-4bp cheaper on the day. News that NZ Treasury plans weekly auction offerings NZ$500m bonds in July appears to have weighed. Recent weekly auctions have been NZ$400mn.

• The local market was also guided by US tsys and ACGBs. Cash tsys are dealing little changed across the major benchmarks in Asia-Pac trade after giving back early strength.
• ACGBs gapped higher after May's CPI Monthly printed lower than expected. The revelation that the core measures saw much smaller declines saw the gains pared. The NZ/AU 10-year yield differential widened by 7bp on the day.
• Swap rates closed 3bp lower with implied swap spreads 7-8bp tighter.
• RBNZ dated OIS pricing closed little changed.
• NZ Prime Minister Hipkins discussed his country’s interest in boosting economic ties with China during a meeting with Chinese President Xi Jinping in Beijing on Tuesday. (See link)
• The local calendar sees the release of the latest ANZ Business Outlook survey tomorrow. On Friday, Consumer Sentiment is expected to continue to signal ongoing recessionary conditions, as households deal with the headwinds of high inflation and interest rates.
• Later today BOJ's Ueda is on a panel at the ECB Forum with Fed Chair Powell, ECB's Lagarde, and BOE's Bailey.