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Off Cheaps, Outperformance Vs. NZGBs Remains Pronounced

AUSSIE BONDS

We also add the previously alluded to weakness in NZGBs and tech-driven bid in equities in light of NVIDIA’s earnings as drivers for the light cheapening seen in the space today, although cross-market outperformance vs. NZGBs remains pronounced in the wake of yesterday’s WPI data, while NZ rates seem to be taking noticed of the higher for longer warnings from the RBNZ. YM -3.0 & XM -2.5 as we type, with wider cash ACGBs running 2.0-3.5bp cheaper as the curve bear flattens, with the space a little above session cheaps. EFPs are a couple of bp or so wider vs. yesterday’s close, which will be adding some light pressure to ACGBs, aided by RBA terminal cash rate pricing moving off of yesterday’s post-WPI base (last showing just above 4.25%).

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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