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Off Best Levels

AUSSIE BONDS

ACGBs have pulled away from best levels, despite a lack of meaningful headline flow, with participants perhaps keen to book quick profits on long positions in the NY, given that the likes of 10-Year ACGB yields are over 30bp lower YtD.

  • Some focus on the China re-opening drive may also be pressuring the space in early Sydney trade, given the lack of core global FI market lead, with JGBs closed & cash Tsys shut until London hours.
  • This comes after Friday saw supply matters (via a lowering of the AOFM issuance task for the current FY) add a domestic component to the largely international-derived richening observed during the early rounds of ’23 trade.
  • Still, a chunk of the richening in lieu of Friday’s soft U.S. data, has held, leaving YM +12.0 & XM +8.0. Meanwhile, cash ACGBs run 3-11bp richer across the curve, with 3s still leading, as the bull steepening impulse holds
  • EFPs have pushed wider with swaps lagging the move in bonds, while the 3-/10-Year box has flattened.
  • Much softer than expected domestic building approvals data failed to impact the space.
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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