Slightly Richer Ahead Of US CPI Data, JGB Spillover

In futures roll-impacted trading, ACGBs (YM +1.4 & XM +1.8) are slightly stronger after dealing in relatively tight ranges in today’s Sydney session. There hasn’t been much in the way of domestic drivers to flag, outside of the previously outlined Westpac Consumer Sentiment and NAB Business Confidence data.

• RBA Governor Bullock largely discussed payments at the AusPayNet Summit today. That said, when asked about monetary policy she said that the RBA still believes that it can slow the economy enough to return inflation to target while preserving most of the employment gains.
• Afternoon strength appears tied to spillover from the post-5Y auction rally in JGBs. In contrast to the recent 2-, 10-, and 30-year supply, which experienced challenges in market digestion, today’s outcome stands out.
• US tsys are 1-3bps richer in the Asia-Pac session.
• Cash ACGBs are 2bps richer, with the AU-US 10-year yield differential 2bps wider at +11bps.
• Swap rates are 3bp lower.
• The bills strip is slightly richer, with pricing flat to +1.
• RBA-dated OIS pricing is little changed.
• Tomorrow, the local calendar sees CBA Household Spending.
• The Mid-Year Economic and Fiscal Outlook (MYEFO) is also scheduled to be published tomorrow with Treasurer Chalmers giving a press conference in the late morning according to Treasury.