NZGBS: Little Changed, US Tsys Take A Breather After Friday’s Rally

In local morning trade, NZGBs are little changed after US tsys weakened slightly as some of the air came out of Friday's post-Powell rally. With little on the docket until Thursday's claims data, 2- and 10-year US tsys finished ~2bps cheaper. Economic data, particularly around the labour market, will determine the pace of easing. There was also possibly some concession building ahead of the start of the $183bn in auctions.

• The market also took interest in oil prices after the exchange of missiles between Israel and Lebanon on Sunday. Prices nudged higher in Asian trading before surging after Libya said it would halt crude oil exports. Prices were up over 3%.
• Wall Street corrected from overbought conditions, with the S&P500 down 0.3%. It was weighed by falls across the mega-cap stocks, with some nerves heading into Nvidia’s earnings results later this week.
• Swap rates are 1-2bps higher, with the 2s10s curve unchanged.
• RBNZ dated OIS pricing is little changed across meetings. A cumulative 75bps of easing is priced by year-end.
• Today, the local calendar is light, ahead of Filled Jobs data tomorrow, ANZ Business Confidence on Thursday and Building Permits on Friday.
• On Thursday, the NZ Treasury plans to sell NZ$250mn of the 4.50% May-30 bond, NZ$200mn of the 4.50% May-35 bond and NZ$50mn of the 2.75% May-51 bond.