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Weaker, Narrow Range, Headlines Watch

AUSSIE BONDS

ACGBs are cheaper (YM -9.0 & XM -4.5) after trading in a relatively narrow range in the Sydney session so far. To recap early in the session Fitch placed the US on negative ratings watch as the deadline for an increase in the debt ceiling approaches. US tsys are flat to 2bp cheaper in Asia-Pac trade.

  • Other than that, there hasn’t been any meaningful macro news flow crossing in recent dealing.
  • Cash ACGBs are 4-8bp cheaper with 3/10bp curve flatter and the AU-US 10-year yield differential -1bp at -6bp.
  • Swap rates are 2-6bp higher with EFPs 2bp tighter.
  • The bills strip bear flattened with pricing -3 to -8.
  • RBA dated OIS opened 1-9bp firmer with late ‘23/early ’24 leading.

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