NZGBS: Cheaper After Central Bank Action Drive Global Yields Higher

In early local trade, NZGBs are 4bp cheaper as global yields rose due to actions taken by central banks. The BoE delivered a hawkish surprise by hiking 50bp to 5.0%, marking its 13th consecutive hike. This decision brings the bank rate to its highest level since 2008 and reflects a total of 475bp of hikes in the current tightening cycle.

• The Norges Bank caught the market off guard by implementing a 50bp hike and maintaining a tightening bias.
• During Fed Chair Powell's second day of policy testimony to Congress, he reiterated the prevailing view that if the economy continues to perform as expected, it would be appropriate to raise rates again this year.
• The BoC published the Minutes of the June meeting, revealing the underlying strength of the Canadian economy and concerns regarding the trajectory of inflation was likely to deliver more tightening.
• US tsy yields finished 6-9bp higher across major benchmarks with the 5-year leading.
• Swap rates are 3bp higher with implied swap spreads tighter.
• RBNZ dated OIS pricing is 1-4bp firmer across meetings with May’24 leading.
• NZ is to begin weekly Treasury bill tenders from July 1.
• The local calendar is light today with ANZ Truckometer for May as the highlight.