Richer After Mixed Domestic Data Drop

ACGBs (YM+6.0 & XM +3.0) are 1-2bps richer after the domestic data drops showed mixed results. Q3 capex rose 0.6% q/q versus expectations of +1.0%, with plant and equipment +0.5% q/q and Buildings and structures +0.7% q/q. In contrast, October’s buildings approvals showed a better than expected result, printing +7.5% m/m versus +1.4% estimate. Private sector credit rose 2.2% m/m in October versus a revised -4.7% prior.

• Cash ACGBs are 3-6bps richer on the day, 2bps richer post-data, with the 3s10s curve steeper and the AU-US 10-year yield differential 1bp tighter at +8bps.
• The swaps curve has bull-steepened, with rates 1-5bps lower.
• The bills strip is richer, with pricing flat to +3.
• RBA-dated OIS pricing is 2-4bps softer on the day, 1bp softer post-data, for meetings beyond Mar’24.
• NSW TCorp has launched an increase to the 4.25% 20 February 2036 benchmark bond for as much as A$1.5 billion via syndication, UBS said in an emailed statement. Indicative price guidance for the transaction is 85-88 bps over the 10yr bond futures contract, equivalent to 81.15-84.15bps over the ACGB 2.75% 21 June 2035. Pricing today, with joint lead managers ANZ, UBS and Westpac.