Slightly Cheaper, BoP Data Today, Q4 GDP Tomorrow

ACGBs (YM -2.0 & XM -1.5) are marginally weaker after US tsys finished 3-7bps cheaper across benchmarks on Monday. No obvious headline driver for the paring of Friday's rally amid cautious trade ahead of Fed Chairman Powell's Humphrey Hawkins testimony to Congress Wed-Thu and the Payrolls Report Friday.

• Powell is expected to stress a ‘wait-and-see’ stance and concerns regarding easing prematurely.
• Comments from Fed voter Bostic and another heavy corporate issuance calendar also weighed on US tsys.
• Fed Bostic said his base case remains for two rate cuts this year, likely starting in the third quarter, and does not anticipate reductions at back-to-back meetings, adding he would like quantitative tightening to continue at the current pace for as long as possible.
• Judo Bank Composite (52.1 from 49 in Jan) and Services (53.1 from 49.1 in Jan) PMIs rise to their highest reading since April 2023 in February.
• Cash ACGBs are 2bps cheaper, with the AU-US 10-year yield differential 1bp higher at -10bps.
• Swap rates are 1-2bps cheaper.
• The bills pricing is flat to -2.
• RBA-dated OIS pricing is little changed.
• Today, the local calendar sees Judo Bank PMI Composite & Services, Q4 Net Exports of GDP and BoP Current Account Balance. Q4 GDP is due on Wednesday.