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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
AUSSIE BONDS
YM & XM are -8.0 and -10.0, repsectively, after U.S. Tsys trade heavy after PMI and Philly Fed data come in on the strong side. Cash ACGBs yields are 7-10bp led by the 1-year with AU/US 10-year yield differential holding around -4bp. 3/10 cash curve is 3bp steeper.
- Swaps rates, mirroring ACGBs, open 8-10bp higher.
- Bills trade 4-7bp softer across the strip, led by the reds.
- Immediate RBA-dated OIS holds yesterday’s closes with a 95% chance of a 25bp hike in March, while terminal rate expectations are above 4.30% for the first time since late October.
Figure 1: RBA-Dated OIS – Terminal Rate Expectations (%)
Source: Bloomberg / MNI - Market News
- After the run of softer labour market data, the market will be keen to see if the recent acceleration in the WPI will be maintained. The WPI rose 1.0% Q/Q in September with an annual pace of 3.1%, the strongest increase since 2013. With the RBA having recently flagged its concerns about services inflation and nodding its head to signs of swifter wage growth, today’s data has the potential to be a market mover.
- Q4 Construction Work Done is also on the local docket today.
- Elsewhere, the Australian Office of Financial Management (AOFM) will auction $900mn of ACGB May-34.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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