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NZGBS: Richer But Early Geopolitical-Induced Gains Pared

BONDS

NZGBs closed richer but off the session’s best levels, with benchmark yields 1-2bps lower. With the local docket empty today, local participants have been on headlines and US tsys watch following the weekend’s escalation in Middle East tensions.

  • US tsy futures are dealing richer in early Asia-Pac dealings at 107-06, +0-11 from NY closing levels, but are well off the early session high of 107-20+.
  • Cash US tsys are closed today for the Columbus Day holiday.
  • Swap rates are flat to 1bp lower, with implied swap spreads mixed.
  • BNZ Job ads index falls 2.3% m/m following a 2.1% gain in August.
  • RBNZ dated OIS pricing is 1bp softer for meetings out to July’24 and 3-5bps softer beyond.
  • The data docket is relatively light this week, with Net Migration on Wednesday, Food Prices on Thursday and Business NZ Mfg PMI and Card Spending on Friday.

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