NZGBS: Cheaper As Q1 US GDP Revision & Jobless Claims Pressure US Tsys

In early local trade, NZGBs are 5-6bp cheaper, after US data triggered new highs in tsy yields as the economy grew faster than anticipated GDP annualised q/q 2.0% vs. 1.4% est., 1.3% prior. Weekly claims also receded (239k vs. 265k est., 264k prior) after showing stronger-than-expected gains the last few weeks. Latest pending home sales did moderate, however, -2.7% m/m vs. -0.5% est.

• Cash US tsys finished the NY session 9-16bp cheaper across major benchmarks with the curve flatter at -102bp. A deeper inverted level of -107 was seen earlier in the session.
• July 26 FOMC has climbed to 84% with the implied rate of +21bp to 5.28%. September fully pricing hike with a cumulative of +29bp at 5.36%, November’s cumulative climbs to 35bp at 5.425%.
• Swap rates are 6-7bp higher with the 2s10s curve steeper.
• RBNZ dated OIS pricing is flat to 5bp firmer across meetings with April’24 leading.
• ANZ consumer confidence rose to 85.5 in June from 79.2 in May. Consumer confidence rose 8% m/m with the gauge at its highest level since January 2022. The proportion of people who believe it is a good time to buy a major household item rose 7 points to -27. Inflation expectations dropped to 4.3% from 4.8%.