AUSSIE BONDS: Cheaper But Off Worst Levels Despite Jobs Beat
ACGBs (YM -6.0 & XM -5.5) are cheaper but notably better than Sydney session lows set following the release of stronger-than-expected employment data.
- Cash US tsys are little changed in today's Asia-Pac session after yesterday's heavy session. Today's US calendar will see a heavy round of economic data: Retail Sales, PPI, Weekly Claims, Industrial Production and Capacity Utilisation.
- Employment in April printed significantly higher than expected at +89k, but the unemployment rate remained at 4.1%.
- The April jobs data continue to show that Australia’s labour market remains tight with employment growth keeping up with the labour force over the last year. However, there are some early signs that workers would like more hours.
- Cash ACGBs are 6-7bps cheaper on the day with the AU-US 10-year yield differential at +1bps.
- The bills strip has retained its bear-steepener, with pricing -3 to -7.
- RBA-dated OIS pricing is 1-3bps firmer across meetings after the data. A 25bp rate cut in May is given an 89% probability (95% pre-data), with a cumulative 75bps (76bps pre-data) of easing priced by year-end.
- Tomorrow, the local calendar will be empty apart from the AOFM’s planned sale of A$800mn of the 2.50% 21 May 2030 bond.
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
BOBL TECHS: (M5) Trading Above Support
- RES 4: 120.20 High Dec 12 ‘24 (cont)
- RES 3: 120.000 Psychological round number
- RES 2: 119.960 High Apr 7 and the bull trigger
- RES 1: 119.470 High Apr 11
- PRICE: 119.340 @ 05:45 BST Apr 15
- SUP 1: 118.336/117.680 20-day EMA / Low Apr 9 / 1
- SUP 2: 117.410 Low Mar 27
- SUP 3: 117.126 76.4% retracement of the Mar 6 - Apr 7 bull cycle
- SUP 4: 117.080 Low Mar 25 and a key short-term support
Bobl futures continue to trade below their recent highs. The latest move down - for now, appears corrective. The early April rally resulted in a break of key resistance at 119.040, the Feb 28 high. This strengthens bullish conditions and signals scope for a continuation. The focus is on the 120.000 handle next. The contract has been in overbought territory, a move down has allowed this to unwind. Initial firm support lies at 117.680, the Apr 9 low.
BONDS: NZGBS: Sharp Bull-Flattening In Line With US Tsys
NZGBs closed at session highs in a bull-flattening move, with benchmark yields falling 5–15bps across the curve.
- The short end underperformed, partly due to a sharper rise in NZ food prices, which climbed 3.5% in the year to March 2025, up from 2.4% in February. Stats NZ attributed the increase primarily to higher prices in the grocery food and meat, poultry, and fish categories, which rose 5.1% and 5.3%, respectively.
- Meanwhile, the long end found support from US tsys. Cash US tsys has bull-flattened during today's Asia-Pacific session, with yields flat to 4bps lower. The US calendar is light today, with attention turning to retail sales and remarks from Fed Chair Powell on Wednesday.
- Swap rates closed flat to 9bps lower, with the 2s10s curve flatter.
- RBNZ dated OIS pricing closed 1-2bps firmer across meetings. 30bps of easing is priced for May, with a cumulative 78bps by November 2025.
- Tomorrow, the local calendar will see Non-Resident Bond Holdings data, ahead of Q1 CPI on Thursday.
- On Thursday, the NZ Treasury plans to sell NZ$275mn of the 3.00% Apr-29 bond and NZ$225mn of the 4.25% May-36 bond.
EURUSD TECHS: Bullish Trend Structure
- RES 4: 1.1608 High Nov 9 2021
- RES 3: 1.1555 1.382 proj of the Feb 28 - Mar 18 - 27 price swing
- RES 2: 1.1495 High Feb 10 2022
- RES 1: 1.1473 High Apr 11
- PRICE: 1.1358 @ 05:56 BST Apr 15
- SUP 1: 1.1144 High Apr 3 and a recent breakout level
- SUP 2: 1.0972 20-day EMA
- SUP 3: 1.0788 50-day EMA and a short-term pivot level
- SUP 4: 1.0733 Low Mar 27 and a key short-term support
A bull cycle in EURUSD remains intact and the pair is holding on to the bulk of its recent gains. The breach last week of 1.1144, the Apr 3 high and bull trigger, confirmed a resumption of the uptrend and maintains the price sequence of higher highs and higher lows. Sights are on 1.1555 next, a Fibonacci projection. Initial support lies at the 1.1144 breakout level. Key support is unchanged at the 20-day EMA, at 1.0972.
