AUD: Exchange traded Option

• Treasury futures show little reaction to slightly higher than expected Chicago PMI data.
• Tsy Jun'25 10Y futures trades 111-18 (+11.5) -- still off initial technical resistance of 111-22.5 (today's intraday high) -- next resistance above at 112-01 (High Mar 4 and a bull trigger), curves mildly flatter: 2s10s -.253 at 33.292, 5s30s -.616 at 64.155.
• Cross asset: Stocks renain under pressure (SPX eminis -82.50 at 5540.50), Gold making new highs over 3108.0, Bbg US$ index climbing higher at 1273.43 (+1.56).

In March, the Chicago Report™ also asked firms “How has your business handled / will your business handle unexpected input costs to raise output prices?”

• Of those respondents that answered, 70% said they will review such developments on a ‘case-by-case’ basis.
• 10% reported ‘Any increase will need to be passed on (less than 2% increase in supplier costs)’, whilst 7% each reported ‘Only increases of at least 5% would be passed on’ and ‘Only increases of at least 10% or more would be passed on”.
• Around 3% each only said ‘Only increases of at least 2% or more would be passed on’ or they ‘added a temporary up-charge/surcharge to cover such an increase’.

USD Index sees further support on the back of that MNI Chicago PMI print, with risk- and growth-sensitive currencies still bearing the brunt of the sell-off. As a result, AUD/USD, NZD/USD hit new daily lows, while USD/CAD affirms the underlying uptrend to target 1.4402 initially ahead of 1.4543 further out.

• Volumes still relatively healthy across currency futures markets for a Monday - after a busy European morning EUR futures activity has faded slightly into the NY crossover, but remains supported; AUD futures standout however, >30% than the average for this time of day.