Waiting For Lowe

Not much doing for the space as we head into the first RBA decision of 2021, with YM -0.5 and XM -2.0. Cash ACGB trade sees some modest steepening with swaps generally wider out to 5-Years and tighter further out.

• As we have flagged in our preview, broader consensus expects a rollover of the Bank's A$100bn bond buying scheme when the current facility is exhausted (at the end of April), with the new scheme expected to last for 6 months, while there is some speculation surrounding the potential for a slightly bigger split for semi-government bonds in the next round of purchases. We don't expect such an announcement to come today, but the Board should reaffirm its pledge to providing loose monetary conditions via its existing forward guidance. RBA Governor Lowe may choose to allude to what the future holds in his Wednesday and/or Friday address, question dependent, although he may also refrain from giving a direct answer.