GOLD: Gold Set for Biggest Weekly Gain of Year

Oct-17 03:39

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* The relentless rally for gold continued today as new all time highs were reached yet again. * A ...

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JGBS AUCTION: 20-Year JGB Auction Results

Sep-17 03:39

The Japanese Ministry of Finance (MOF) sells Y614.9bn 20-Year JGBs:

  • Average Yield: 2.654% (prev. 2.581%)
  • Average Price: 98.00 (prev. 98.93)
  • High Yield: 2.662% (prev. 2.591%)
  • Low price: 97.90 (prev. 98.80)
  • % Allotted At High Yield: 98.6020% (prev. 65.3666%)
  • Bid/Cover: 3.9974x (prev. 3.0853x)

AUSSIE BONDS: Little Changed On A Data-Light Session

Sep-17 03:29

ACGBs (YM -0.5 & XM flat) are little changed on a data-light session

  • Westpac’s lead index signalled slowing growth in August with the 6-month annualised rate turning negative (-0.16% down from July’s +0.11%) for the first time since September 2024. Almost all variables have eased over the last 6 months. It is signalling that growth on a 2q/2q basis could slow over the coming quarters.
  • Cash ACGBs are little changed with the AU-US 10-year yield differential at +19bps.
  • The bills strip is slightly weaker.
  • RBA-dated OIS pricing is little changed across meetings today. A 25bp rate cut in September is given a 9% probability, with a cumulative 22bps of easing priced by year-end (based on an effective cash rate of 3.60%).
  • The focus this week, however, will be on Thursday's August jobs data. Employment is forecast to rise 21k after July's +24.5k, with the unemployment rate expected to remain at 4.2%. It will also be important to monitor underemployment, the split between full-time & part-time and hours worked. The RBA is currently expected to leave rates unchanged on September 30 as it waits for Q3 CPI on October 29.

JGBS: Slightly Cheaper Ahead Of 20Y Auction Results

Sep-17 03:23

At the Tokyo lunch break, JGB futures are slightly stronger, +2 compared to the settlement levels.

  • Cash US tsys are little changed in today's Asia-Pac session after yesterday's modest rally
  • Cash JGBs are flat to 1bp cheaper across benchmarks. The benchmark 20-year yield is 0.5bp higher at 2.671% ahead of today's supply.
  • Last month’s 20-year JGB auction showed mixed results across key metrics. The low price underperformed dealer forecasts, which were set at 98.85 according to a Bloomberg poll. Moreover, the cover ratio declined to 3.0853 from 3.1462x in the previous auction. The auction tail did, however, shorten to 0.13 from 0.18.
  • Today’s 20-year JGB auction offers an outright yield near its cycle high, 10bps above last month’s level.
  • Moreover, the 10/20 yield curve remains near its recent high, its steepest since 1999.
  • Swap rates are flat to 1bp higher. Swap spreads are mixed.