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The Driving Force For Core FI

AUSSIE BONDS

Aussie bond futures have stabilised off of lows, with YM going out -4.0 and XM -12.0.

  • There seemed to be several factors that intertwined to drive the latest leg of weakness during Sydney trade: The market being disappointed with the size of RBA purchases employed to enforce the Bank's 3-Year ACGB yield target (A$3.0bn today), stronger than expected local CapEx data & trans-Tasman impetus after the tweak to the RBNZ's remit, with the Bank now set to consider "the impact on housing when making monetary and financial policy decisions." Some also pointed to cross market AUD longs/received positions being washed out.
  • AUD 1-Year/1-Year swap rates briefly printed through recent highs during the aforementioned vol., before easing back from best levels of the day.
  • Private sector credit data and the weekly AOFM issuance slate headline tomorrow's local docket.
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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