Richer, US Tsy Yields Lower After Fedspeak, Sentiment Data Due

ACGBs are higher (YM +7.0 & XM +8.0) after US tsy yields moved lower in the NY session led by the short end. 3- and 5-year tsys richened 12bp with the 2-year 9bp richer. The 10-year yield dropped back below 4% with the curve maintaining its recent steepening trend. The move lower in yields was assisted by Fed Daly, Mester and Barr headlines leaning on the dovish side of balanced. Barr expressed the belief that there is still "more work to do but close to the end," while Daly emphasised that risks are becoming less imbalanced, making decisions more challenging and reliant on additional data.

• Cash ACGBs opened 7-8bp richer with the AU-US 10-year yield differential unchanged at +21bp.
• Swap rates are 7-8bp lower with the 3s10s curve flatter.
• The bills strip is richer with pricing +3 to +7, early reds leading.
• RBA-dated OIS pricing is 1-6bp softer across meetings. The market attaches a 58% chance of a 25bp hike at the August meeting.
• First up on the data front today is the CBA household spending measure for June, followed by the Westpac consumer sentiment index for July, and then later the NAB business confidence and conditions indices for June.