Richer

Aussie bonds caught a bid after an earlier blip lower on wider fixed income moves, the marginal beat in private sector credit growth and an uptick in PPI in Y/Y terms (although with a modest moderation in Q/Q terms). Wider core FI market gyrations were at the fore, with the move higher ultimately facilitated by U.S. Tsys unwinding their earlier cheapening. Cash ACGBs run 8.5-21.0bp richer across the curve, with the belly leading the bid. YM is +20.5 while XM is +19.5, off best levels after showing through their respective overnight highs, with XM back below its overnight peaks at typing. Bills run 14 to 26 ticks richer through the reds, bull flattening.

• The first tap of the ACGB Nov-33 bond went smoothly enough, with the weighted average yield pricing 0.97bp through prevailing mids (per Yieldbroker). The cover ratio was less firm however, coming in at 2.25x - while the print did not point to any outright difficulty re: digestion, it came nowhere near the highest level of cover observed at recent ACGB auctions.
• The AOFM issuance slate announced for next week provoked little reaction in Aussie bonds, with the return to A$1.5bn of ACGBs and A$2.0bn of notes on offer.
• Monday will see m’fing PMI, Melbourne Institute Inflation, and ANZ job ads headline the data docket, although their proximity to the RBA’s monetary policy decision on Tuesday may limit any potential impact from that suite of data. Note that CoreLogic house prices are due to cross late Sunday/early Monday.
• Also note NSW will observe a state holiday on Monday.