NZGBS: Closed Flat, Budget Policy Statement The Focus

NZGBs closed flat to 1bp cheaper but near the session’s best level. Today the focus was on the Budget Policy Statement.

• (Bloomberg) NZ Treasury has downgraded expectations for GDP growth in the Budget Policy Statement. It sees 0.1% annual average growth through June 2024 and 2.1% annual average growth through June 2025. As a result, tax revenue over five years to 2028 will be NZ$13.9b less than projected in HYEFU. (See link)
• (Bloomberg) NZ Finance Minister Nicola Willis will press ahead with tax cuts this year even as the stagnant economy curbs government revenue. Tax relief will be announced in the May budget and delivered from July 1, Willis said today in Wellington. (See link)
• Cash US tsys are dealing little changed in today's Asia-Pac session.
• Swap rates closed flat to 1bp lower, with the 2s10s curve flatter.
• RBNZ dated OIS pricing is slightly softer across meetings. A cumulative 68bps of easing is priced by year-end.
• Tomorrow, the local calendar sees ANZ Consumer and Business Confidence.
• Tomorrow, the NZ Treasury plans to sell NZ$275mn of the 3% Apr-29 bond and NZ$225mn of the 4.25% May-34 bond.
• Later today will see US Wholesale Sale/Inventories and $43bn of 7Y US tsy supply. Also, Fed Gov Waller will discuss the economic outlook at Economic Club NY at 1800ET (text, Q&A).