AUSTRALIA DATA: Multi-Dwellings Drove Approval Growth In Q2
The number of building approvals rose sharply in June driven by the volatile multi-dwelling component. They were up 11.9% m/m after a downwardly-revised +2.2% in May with private houses down 2.0% m/m but non-houses jumped 33.1% m/m. Both components are above Q4 2019 levels at 8.1% and 18.6% respectively but with housing shortages persisting, further rises in approvals are needed.
- Private house approvals have fallen in three of the last four months leaving annual growth at only 0.2% down from May’s 2.2%. The June decline was broad based across most states with Queensland seeing the sharpest drop.
- Multi-dwelling units are now up 87.1% y/y after strong growth in May and June.
- Lower building costs saw house approval value growth moderate in FY 25 at +4.8% y/y compared with 6.4% y/y in FY24.
Australia number of dwelling approvals y/y%
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JGBS AUCTION: 10Y Supply Faces A Lower Yield & Flatter Curve
The Japanese Ministry of Finance (MoF) will today sell Y2.6tn of 10-year JGBs. The MoF last sold 10-year debt on 3 June 2025. This month’s auction offers an outright yield 5-10bps lower than last month and approximately 15bps below the recent cyclical high of 1.596% reached in late March, just prior to President Trump’s announcement on reciprocal tariffs.
- Moreover, the 2s/10s and 7s/10s yield curves are flatter than last month.
- Notably, investor sentiment toward longer-dated global bonds has improved over June.
- Governor Kazuo Ueda reaffirmed on June 20 that the BoJ would consider raising its benchmark interest rate if its economic outlook materialises. Speaking at a financial conference in Tokyo, Ueda noted that Japan's real interest rate remains significantly low and emphasised the importance of assessing whether the BoJ's projections are being met, without preconceived assumptions.
- Against this backdrop, it remains to be seen whether the current 10-year yield level will be sufficient to maintain strong demand in today’s auction.
- Results are due at 0435 BST / 1235 JT.
JGBS AUCTION: Poll: 10-Year JGB Auction
*JAPAN 10Y GOVT BOND AUCTION MAY HAVE 100.40 LOWEST PRICE: POLL– BLOOMBERG
JGBS AUCTION: PREVIEW - 10-Year JGB Auction Due
The Japanese Ministry of Finance (MoF) will today sell Y2.6tn of 10-year JGBs. The MoF last sold 10-year debt on 3 June 2025. The auction drew cover of 3.6627x at an average yield of 1.512%, an average price of 99.04, a high yield of 1.513%, a low price of 99.03, with 66.8994% of bids allotted at the high yield.
- Last month’s auction revealed strong results, with the low price beating expectations at 98.95, according to the Bloomberg dealer poll. Moreover, the cover ratio increased to 3.6627x from 2.5440x, and the tail shortened to 0.01, the shortest since March 2023, from 0.18.
- That performance came with an outright yield 25bps higher than the prior month's auction level and only 10bps below the recent cyclical high of 1.596%.
- Results are due at 0435 BST / 1235 JT.
