BONDS: NZGBS: Twist-Flattener After RBNZ 3:3 Vote To Keep OCR Unchanged

Gold is 0.4% higher in today’s Asia-Pac session, after closing 0.3% higher at $4710 on Friday. 

• Bullion had fallen early in today’s session after hopes of reviving peace efforts had receded on Saturday when Trump scrapped a visit to Islamabad by his envoys Steve Witkoff and Jared Kushner, even as Iranian Foreign Minister Abbas Araqchi continued to shuttle between mediating countries.
• However, the yellow moved away from the lows following a report that Iran offered the US a proposal to reopen the Strait of Hormuz, easing concern that efforts to restart peace talks had stalled.
• "Iran's plan, conveyed through mediators in Pakistan, calls for extending the ceasefire so the parties can work toward a permanent end to the fighting, Axios said, citing people with knowledge of the matter. Nuclear talks would come later, only after a US blockade of the Strait of Hormuz is lifted, it said." - BBG
• According to MNI’s technicals team, the latest rally was capped by the 50-dma into 4869.6, a level that is growing in importance as a bull trigger. A rally through here would target $4914.9, a Fibonacci retracement point, before the $5000.0 handle. Initial firm support to watch lies at $4554.2, the Apr 2 low. A break of this level would be bearish.

Source: Bloomberg Finance LP

In afternoon trade, JGB futures are weaker and at session cheaps, -24 compared to settlement levels.

• Cash bonds are 1-2bps cheaper in today's Asia-Pac session following a report that Iran offered the US a proposal to reopen the Strait of Hormuz, easing concern that efforts to restart peace talks had stalled.
• "Iran's plan, conveyed through mediators in Pakistan, calls for extending the ceasefire so the parties can work toward a permanent end to the fighting, Axios said, citing people with knowledge of the matter. Nuclear talks would come later, only after a US blockade of the Strait of Hormuz is lifted, it said." - BBG
• Most banks see the BOJ pausing at the 27–28 April meeting while retaining a “hawkish hold” stance, with tightening still part of the forward path.
• Governor Ueda is expected to emphasise data dependence and “difficult policy trade-offs,” while still signalling that “more tightening will be needed over time,” alongside possible downgrades to growth forecasts and upgrades to inflation.
• Market pricing and bank forecasts cluster around a June move (with July a fallback). (See MNI BOJ Preview here)
• Cash JGBs are flat to 3bps cheaper across benchmarks, with a steeper curve. 

Source: Bloomberg Finance LP

Key major Asia Pac equity markets are mostly higher so far in Monday trade, although tech plays remain the standout. Sentiment started softer in the US futures space, as planned weekend talks between US-Iran failed to materialize. However, dips in futures were supported, as headlines from Axios crossed around a reported proposal Iran sent to the US (via Pakistan mediators) on re-opening Hormuz, but pushing back nuclear talks to later discussions. It remains to be seen how the US responds, but Eminis have tested above 7200, fresh cycle highs. 

• This backdrop has likely helped broader market sentiment, although tech/AI related plays remain the clear outperformers. Both the Kospi and Taiex are up well over 2%, while Japan's NKY 225 is up 1.75%.
• For South Korea's market this is a fresh record high, likewise for the Taiex in Taiwan, which is testing above 40000. The preference of offshore investors remains clearly skewed towards Taiwan stocks though, with close to $15bn in net inflows in Apr to date. These moves follow the surge higher in the SOX index in the US.
• China markets are higher, but only marginally, likewise for Hong Kong, with gains in the 0.15-0.20% region. China profits were up firmly in March, 15.8%y/y. In the January–March period, profits in computer, communications and other electronic equipment surged 1.2 times from a year earlier, with non-ferrous metal smelting up the same amount.
• In South East Asia, trends are more mixed, with both the Singapore bourse and Philippines equities lower. Australia's ASX 200 is also down modestly, but parts of the country are away for a public holiday.
• The main standout on the positive side is Thailand, up over 1.6%.