Twist Flattening Holds

Light twist flattening evident again on the Aussie curve, with YM -0.5 and XM +1.0.

• The flash CBA PMI data saw services lead the composite print into contractionary territory. CBA noted that "the decline in business activity over August is hardly surprising given the lockdown measures in Victoria. With the August composite flash PMI only modestly in contractionary territory it is highly likely that outside of Victoria private output continued to expand over the month. The fall in employment is the inevitable consequence of shutting down large parts of the Victorian economy. Encouragingly, firms collectively retain an optimistic view on the outlook despite the setback in Victoria. Ongoing fiscal support for households and businesses remains critical to ensuring that optimism is not misplaced."
• Bills unchanged to -1 through the reds.
• Supply sits at the fore for the remainder of the session, with A$2.0bn worth of ACGB 0.25% Nov '24 supply due up, as well as the release of the AOFM's weekly issuance schedule.