Richer, US Curve Twist-Steepens Following FOMC, Employment Report Due

ACGBs (YM +3.0 & XM +3.0) are richer after US tsys twist-steepen following the FOMC Decision, pivoting at the 30s, with yields +1bp to -8bps.

• As expected, The Fed Funds rate target range was maintained at 5.25-5.5%, as expected.
• The dot plot continued to show three expected rate cuts this year while for 2025 the number of cuts expected was reduced from four to three.
• Chairman Powell said the Fed had "discussed issues related to slowing the pace of decline in our securities holdings. While we did not make any decisions today on this, the general sense of the committee is that it will be appropriate to slow the pace of run-off fairly soon."
• Cash ACGBs are 3-4bps richer, with the AU-US 10-year yield differential 2bps lower at -25bps.
• Swap rates are 1-2bps lower.
• The bills strip has bull-flattened, with pricing flat to +4.
• RBA-dated OIS pricing is 3-4bps softer for meetings beyond September. A cumulative 42bps of easing is priced by year-end.
• Judo Bank PMIs (Mar P): Mfg falls to 46.8 from 47.8 in Feb; Services rises to 53.5 from 53.1 in Feb; and Composite rises to 52.4 from 52.1 in Feb.
• Today, the local calendar also sees the February Employment Report. Consensus expects a 40k increase in Jobs, with the Unemployment Rate falling from 4.1% to 4.0%.