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Tight Ranges In Play Ahead Of Long Weekend & RBA, Curve Steeper

AUSSIE BONDS

The ACGB space has held onto the twist steepening impetus derived from overnight futures trade, with generally limited activity observed ahead of the long Sydney weekend.

  • That leaves YM +1.5 & XM -1.5, with wider cash ACGBs running 2bp richer to 2bp cheaper, pivoting around 7s.
  • Bills run -1 to +2 through the reds.
  • The 3-/10-Year EFP box has bear steepened, with 3-Year EFP narrower and 10-Year EFP little changed.
  • Participants were seemingly unwilling to deploy fresh risk ahead of Monday’s lower liquidity session (which includes the closure of cash ACGBs owing to a NSW & ACT holiday) and Tuesday’s RBA decision (with ~44bp of tightening priced into OIS and 13/17 surveyed by BBG looking for a 50bp hike).
  • A lack of meaningful headline flow also limited participation.
  • Participants looked through mixed Chinese PMI data, as well as the latest round of domestic private sector credit readings.
  • The latest round of ACGB Nov-28 passed smoothly,, while the AOFM weekly issuance slate was fairly vanilla on the ACGB front, albeit with a bit of an upsizing in Note issuance.
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The ACGB space has held onto the twist steepening impetus derived from overnight futures trade, with generally limited activity observed ahead of the long Sydney weekend.

  • That leaves YM +1.5 & XM -1.5, with wider cash ACGBs running 2bp richer to 2bp cheaper, pivoting around 7s.
  • Bills run -1 to +2 through the reds.
  • The 3-/10-Year EFP box has bear steepened, with 3-Year EFP narrower and 10-Year EFP little changed.
  • Participants were seemingly unwilling to deploy fresh risk ahead of Monday’s lower liquidity session (which includes the closure of cash ACGBs owing to a NSW & ACT holiday) and Tuesday’s RBA decision (with ~44bp of tightening priced into OIS and 13/17 surveyed by BBG looking for a 50bp hike).
  • A lack of meaningful headline flow also limited participation.
  • Participants looked through mixed Chinese PMI data, as well as the latest round of domestic private sector credit readings.
  • The latest round of ACGB Nov-28 passed smoothly,, while the AOFM weekly issuance slate was fairly vanilla on the ACGB front, albeit with a bit of an upsizing in Note issuance.