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Steepening Hits Cash ACGB Curve, AOFM Cuts Planned Issuance

AUSSIE BONDS

The ACGB space showed little immediate reaction to an update from the AOFM, who cut expected bond issuance for 2021-22 to A$105bn from ~A$130bn. Still, the Aussie bonds have come under some mild pressure thereafter, as the local equity benchmark has advanced. Australian daily Covid-19 cases are under scrutiny, as states appear committed to go ahead with reopening plans despite an uptrend in cases.

  • Cash ACGB curve runs steeper, yields sit -1.0b to +4.0bp. Futures trade on the back foot, with YM +0.5 & XM -2.5. Bills trade -3 to +2 ticks through the reds.

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