March 21, 2023 21:29 GMT
NZGBS: Weaker Following U.S. Tsys Lead
NZGBs open 10-11bp cheaper across the curve as U.S. Tsys bear flatten ahead of the FOMC announcement tonight. After the bell, 2-year and 10-year U.S. Tsy yields were respectively 20bp and 12bp higher.
- Swaps open 8-13bp weaker, implying wider short-end and tighter long-end swap spreads, with the 2s10s curve 5bp flatter.
- RBNZ dated OIS pricing opens 3-14bp firmer across meetings with the April meeting at 24bp of tightening. Terminal OCR expectations rise 6bp to 5.24%
- Released already today, Q1 NZ Consumer Confidence showed a modest rise in sentiment to 77.7 from 75.6 but remained on the pessimistic side of the ledger.
- In Australia, Westpac’s Leading Index for February is due for release today.
- The markets, nonetheless, await the FOMC Policy Decision tonight. BBG consensus expects a 25bp hike, although some analysts expect no move. Market is pricing an 82% chance of a 25bp hike up from 70% yesterday.