NZGBS: Gives Back Early Strength, Closes Flat, Review Leaves RBNZ’s Remit Unchanged

NZGBs closed on a low note with benchmark yields 1-2bp higher after trading 5bp lower earlier in the local session. In the absence of domestic catalysts, the local market appears to have been content to be steered by US tsys in Asia-Pac trade. Cash US tsys are 0.5-1bp cheaper, after giving up earlier gains.

• NZ Finance Minister Grant Robertson says the Reserve Bank’s Monetary Policy Committee remit and charter is largely unchanged following the first five-year review, with only minor changes to the monetary policy framework. Adding that the current monetary policy framework “remains fit for purpose”. (See link)
• Swap rates closed 1bp lower with implied swap spreads tighter.
• RBNZ dated OIS pricing closed flat to 2bp softer across meetings with terminal OCR expectations at 5.64%.
• The local calendar tomorrow is light again ahead of the latest ANZ Business Outlook survey on Thursday. On Friday, Consumer Sentiment is expected to continue to signal ongoing recessionary conditions, as households deal with the headwinds of high inflation and interest rates.
• Later today sees a slew of US data including US New Home Sales, Durable Goods and Conference Board Consumer Confidence. We also have the latest 5-Year Supply.