June 11, 2024 04:45 GMT
Off Cheaps, Narrow Ranges, Focus On Wednesday’s US CPI & FOMC
AUSSIE BONDS
In roll-impacted dealings, ACGBs (YM -0.4 & XM -1.3) are little changed and off early session cheaps after resuming trading following yesterday’s holiday.
- Outside of the previously outlined NAB business survey, there hasn't been much in the way of domestic drivers to flag.
- Cash US tsys are 1-2bps richer in today’s Asia-Pac session as investors keenly await two key events on Wednesday: the latest US CPI data and the latest thoughts from Federal Reserve Chairman Jerome Powell following the FOMC Decision.
- A Bloomberg survey showed that 41% of economists expect the central bank to signal two cuts, while an equal percentage forecast either one cut or none at all.
- Cash ACGBs are 7-9bps higher than Friday’s close and well above session cheaps, with the AU-US 10-year yield differential at -14bps.
- Swap rates are 6-8bps higher, with EFPs tighter and the 3s10s curve steeper.
- The bills strip is little changed after giving up the early bear-steepening.
- RBA-dated OIS pricing is 4-7bps firmer for meetings beyond September, with early 2025 leading. 5bps of easing is priced by year-end.
- Tomorrow, the local calendar is empty, ahead of the Employment Report and CBA Household Spending data on Thursday.
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