NZGBs Richer, Close Near Session Best

NZGBs are 8-10bps richer today and trading near best for the session, over the past month we have seen 25-32bps of tighten across the curve with the 15-20yr the best supported. US Tsys futures have seen an increase in volumes today, after breaking above the overnight highs.

• US treasury futures volumes has surged today, initially volumes picked up after what looked to be stopped being triggered, ~160k TY contracts have traded as we head into the Asia break over double the recent volume for this time of day, the contract trades near intraday highs at 109-30+ up (+ 07+), TU briefly traded above overnight highs, tapping 101.29.75 but has been met with sellers and now trade back at 101-29 up ( +01.125)
• The NZGB curve is little changed, yields are 8-10bps lower with the 2Y -8.7bps at 4.636, 10Y is -8.4bps at 4.558%
• Swap rates are 1-4bps lower, curve flatter.
• RBNZ dated OIS has firmed today with 1-2bps more of cuts into year-end, with a cumulative 48bps of easing now.
• Earlier, Govt Bonds held by foreigners fall to 62.2% from 62.9% in March.
• Looking Ahead: PPI Input/Output On Friday