NZGBS: Closed At Best Levels, Tracking Tsys, Business Confidence Tomorrow

NZGBs concluded the session on a positive note, witnessing a 4bp drop in benchmark yields. In the absence of domestic catalysts, recent shifts in the local market have been primarily influenced by developments in US tsys. Notably, the NZ-US and NZ-AU 10-year yield differentials were relatively stable throughout the day.

• US tsys are holding richer in Asia-Pac trade. Ranges remain narrow, with little meaningful macro news flow crossing. This leaves cash tsys 1-3bps richer across the major benchmarks.
• Swap rates are 4-5bps lower, with implied swap spreads slightly tighter.
• RBNZ dated OIS pricing is little changed across meetings, with terminal OCR expectations steady at 5.76%.
• Bloomberg reports that the RBNZ announced that it bought a net NZ$84m in August, after a net sale of NZ$3.96bn in July.
• Tomorrow the local calendar sees ANZ Business Confidence.
• Later today sees US Durable Goods. Fedspeak from Gov Bowman and Minneapolis Fed President Kashkari will cross. There is also 5-year US tsy supply.