RBA Provides No Surprises

The RBA left its broader monetary policy settings unchanged at its June meeting, with no change in its forward guidance, and nothing in the way of fresh, meaningful information provided. The updates surrounding the economy were more of a mark to market exercise for the Bank, with no change in its underlying view surrounding inflation. July's gathering will prove to be much more interesting, given the key decisions that will take place at that meeting re: the Bank's yield curve targeting scheme and the next tranche of QE.

• Aussie bonds were underpinned ahead of the decision, even with local data generally on the firmer side of expectations, while there was another uptick in cases within the Melbourne COVID cluster. YM & XM now sit at unchanged levels after limited blips lower as the RBA decision hit. 10s see some marginal outperformance on the cash ACGB curve. 3-Year EFPs have established themselves on the 16bp handle.
• There was also the potential for some trans-Tasman impetus in early Sydney trade, with RBNZ chief economist Ha telling Interest NZ that "there might not be an abrupt end to the RBNZ's bond buying when its Large-Scale Asset Purchase (LSAP) programme ends in June 2022." The last couple of days have seen various RBNZ policymakers look to re-assert the notion of optionality into the broader narrative after markets deemed last week's decision (and the OCR track within the MPS) to be hawkish. NZGB have firmed as a result.
• Q1 GDP data headlines tomorrow's local docket. Elsewhere, comments from Bradley Jones, the RBA's Head of Economic Analysis, are due.