RBNZ Weighs

Aussie bond futures trickled lower in the wake of the latest RBNZ monetary policy decision across the Tasman, with the previously outlined hawkish inferences from the contents of the resumed publication of the RBNZ's OCR track and tweaks to its forward guidance weighing on NZGBs, creating some trans-Tasman spill over. Still, cash ACGBs comfortably outperform their NZ equivalents on the day. YM -1.5, XM unch. last, with the wider cash curve seeing a similar degree of twist flattening, although operating off of early session flats. Local data (in the form of stronger than expected completed construction work data for Q1 & another uptick in the Westpac leading index) did little for the space.

• Comfortable absorption of the A$1.0bn ACGB May '32 supply was seen, with the average yield pricing 0.54bp through prevailing mids at the time of supply (per Yielbroker pricing), although the cover was softer than prev. The latter point isn't a great worry, but one to track in future auctions covering this zone of the curve considering the A$200mn decrease in the amount of paper on offer at this auction vs. the prev. auction.
• Elsewhere, the Melbourne COVID cluster continues to see incremental increases in confirmed cases, although there has been no market reaction to the development in recent days, given Australia's track record in dealing with the virus. Still, regional authorities did not rule out the imposition of tighter restrictions in the Greater Melbourne area.
• Q1 Private CapEx data headlines the local docket on Thursday.