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INDIA

Issuance Plan Eyed

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Commodity Related Currencies Bid

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Positive Start

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5-Year Auction Results

RBNZ

VIEW: TD Securities Tweak RBNZ Call

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T-Notes operating a touch above Thursday's lows, last -0-01 at 134-15.

  • T-Notes went out at worst levels of the day on Thursday. The major cash Tsy benchmarks cheapened by ~2.0-5.0bp come the bell, with 5s leading the sell off.
  • WN (+2,065) and FV (+11,500) futures blocks helped stall the sell off around the middle of the U.S. session, before T-Notes trickled back to lows into the bell.
  • Fed Governor Waller pointed to a very high jobs print on Friday, reiterating his optimistic outlook re: the U.S. economy alongside upside risks to inflation.
  • Later in the session Minneapolis Fed President Kashkari (Dove, '23 voter) once again touched on headwinds that the Delta COVID variant could pose for the labour market.
  • In an interesting development Dem. Senator Manchin wrote a letter to Fed Chair Powell noting that "with the recession over and our strong economic recovery well underway, I am increasingly alarmed that the Fed continues to inject record amounts of stimulus into our economy." Worries surrounding inflation seemed to be at the core of his though process.
  • Widening in long-end swap spreads was witnessed as the US$ corporate supply slate built, headlined by multi-tranche offerings from Amgen & Westlake.
  • An address from RBA Governor Lowe and the release of the Bank's SoMP will headline the broader slate during Asia-Pac hours. The monthly NFP print headlines the NY docket on Friday, and may result in limited price action/volume in Asia, unless we see some tier 1 macro headline flow.