NZGBS: Cheaper After Long-End US Tsys Continued Their Retreat, May-35 Supply Due

In local morning trade, NZGBs are 3-5bps cheaper after US tsy yields finished mostly higher. The 10-year reached a fresh YTD high of 4.40% before paring its rise. US tsy curve twist-steepened, pivoting at the 5s, with yields finishing 2bps lower to 5bps higher.

• Intermediate to long end rates closed near the middle of the day's range following slightly higher than expected JOLTS job openings at 8.756m (cons 8.73m) in Feb after a downward revised 8.748m (initial 8.86m) in Jan. The ratio to unemployed fell to 1.36x, helped by the strong 0.33m rise in unemployment in Feb.
• Fed speakers (Mester & Daly) supported short-end rates.
• Swap rates are 3-5bps higher, with the 2s10s curve steeper.
• RBNZ dated OIS pricing is unchanged. A cumulative 69bps of easing is priced by year-end.
• Today, the local calendar is empty, apart from the pricing of the new 4.5% May-35 nominal bond, which was launched yesterday by the NZ Treasury.
• NZ Treasury expects to issue at least NZ$3bn of the new bond, with a transaction cap of NZ$5bn. Initial price guidance is 4-8bps over the May-34 nominal green bond. JLM: ANZ, BNZ, UBS AG and Westpac. Given the timing of the launch, the weekly bond auction scheduled for April 4 has been cancelled.