BONDS: NZGBS: Unchanged As Markets Await Global Inflation Data

ACGBs (YM -4.5 & XM -3.5) are weaker after US tsys finished Friday showing a modest twist-flattener, with benchmark yields 3bps higher to 1bp lower.

• However, WTI has started Monday trading higher after the weekend's events in the Strait of Hormuz with Iran firing on commercial shipping and the US targeting Iran's military capabilities that threaten vessels. There have been two waves of US attacks on Sunday with the possibility of more. Iran has used force to drive vessels to use its route through the Strait rather than following Oman's coastline and on the weekend, it closed the key waterway again.
• Cash ACGBs are 3-4bps cheaper with the AU-US 10-year yield differential at +31bps.
• The bills strip has bear-steepened, with pricing -2 to -5 across contracts.
• RBA-dated OIS pricing shows modest tightening across all meetings, with the probability of a 25bp hike rising from 25% for August to 61% by December 2026.  
• Today, the local calendar will be empty, ahead of Consumer and Business Confidence measures on Tuesday.
• This week, ACGB supply will be greater than the recent average weekly issuance of $1000mn. The AOFM plans to sell A$400mn of the 5.00% 21 June 2036 bond on Tuesday, A$700mn of the 4.50% 21 April 2033 bond on Wednesday and A$700mn of the 2.50% 21 May 2030bond on Friday.

Bloomberg Finance LP

TYU6 is dealing at 108-28, -0-05 from closing levels in today’s Asia-Pac session.

• Cash bonds finished showing a modest twist-flattener, with benchmark yields 3bps higher to 1bp lower.
• WTI has started Monday trading higher after the weekend's events in the Strait of Hormuz with Iran firing on commercial shipping and the US targeting Iran's military capabilities that threaten vessels. There have been two waves of US attacks on Sunday with the possibility of more. Iran has used force to drive vessels to use its route through the Strait rather than following Oman's coastline and on the weekend it closed the key waterway again.
• On Friday, projected rate hike pricing regained momentum around midday - rising vs. late Thursday levels (*) & October back to pricing first 25bp hike: Jul'26 at +8.4bp (6.5bp), Sep'26 at +21.6bp (+18.4bp), Oct'26 at +27.4bp (+23.8bp), Dec'26 +37.1bp (+33.2bp).
• No data today, focus is on next week's CPI and PPI data on Tuesday/Wednesday   respectively, as well as Fed Chair Warsh testimony to the Senate Banking Comm on Wednesday.

Bloomberg Finance LP

NZGBs are unchanged after the long weekend.

• On Friday, US tsys finished showing a modest twist-flattener, with benchmark yields 3bps higher to 1bp lower.
• WTI has started Monday trading higher after the weekend's events in the Strait of Hormuz with Iran firing on commercial shipping and the US targeting Iran's military capabilities that threaten vessels. There have been two waves of US attacks on Sunday with the possibility of more. Iran has used force to drive vessels to use its route through the Strait rather than following Oman's coastline and on the weekend it closed the key waterway again.
• The BNZ-BusinessNZ performance of services index for June was 50.6, up from 48.0 in May, and 48.9 in April.
• Swap rates are little changed.
• RBNZ-dated OIS pricing is little changed across meetings. 21bps of tightening is priced for September, while February 2027 assigns 61bps.
• The Treasury announces the launch of a new 4.75% coupon 15 May 2038 nominal NZGB. Given the timing of the launch, the Treasury also announces the cancellation of the tender scheduled for 16 July 2026.
• The Treasury expects to issue at least NZ$5.0bn with the transaction capped at NZ$7.0bn. Initial price guidance is 6-10bps over the 15 April 2037 bond. The issue will be priced tomorrow.