AUSSIE BONDS: Twist-Steepener With US Tsys, Nov-28 Supply Due
Apr-09 00:21
ACGBs (YM +8.0 & XM -8.0) have twist-steepened in line with developments abroad.
- Overnight, US tsys finished mostly weaker as tariff headlines continued to rattle markets, with curves twisting to the steepest levels in over three years.
- The US long end was hit hard with the 30-year cheapening by 15bps. The 10-year was 11bps higher at 4.29%, while the 2-year yield richened 4bps to 3.73% on haven demand and rate cut bets.
- Trump officials confirmed 104% added tariff on China went into effect at noon, with WH press sec Leavitt adding that additional tariffs are to be collected starting tomorrow.
- Cash ACGBs are 8bps lower to 8bps higher with the 3/10 curve steeper and the AU-US 10-year yield differential at -3bps.
- The bills strip has bull-flattened, with pricing +7 to +14.
- RBA-dated OIS pricing is 1-14bps softer across meetings today. A 25bp rate cut in May is given a 70% probability, with a cumulative 128 bps of easing priced by year-end (based on an effective cash rate of 4.09%).
- Today, the local calendar will see Consumer Inflation Expectation data and a speech by RBA Governor Bullock.
- The AOFM plans to sell A$1000mn of the 2.75% 21 November 2028 bond tomorrow.
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MNI EXCLUSIVE: RBA's New Board Will Thrash Out Its Functions This Month
Mar-10 00:13
The RBA's new board will thrash out its functions this month. On MNI Policy MainWire now, for more details please contact sales@marketnews.com.
UK DATA: KPMG-REC Report on Jobs: Permanent salary growth at 4-year low
Mar-10 00:01
The KPMG-REC Report on Jobs for February continued to signal warning signs regarding the state of the UK labour market.
- Permanent salary growth posted its lowest seasonally-adjusted reading for four years according to the press release, with "weaker demand for staff, improved candidate numbers and tighter budgets" all cited as reasons.
- Hiring continued to decline, albeit at a slower pace than in January with the press release citing that "recruiters frequently commenting that redundancies had expanded the pool of available workers."
- Vacancies were close to January's 53-month low.
- The survey was conducted 10-24 February.
JAPAN DATA: Headline Labor Earnings Weaker, But Detail Firmer
Mar-09 23:55
Japan January labor cash earnings data mostly printed below expectations. The headline was 2.8% y/y, against a 3.0% forecast and revised 4.4% Dec outcome (originally reported as a 4.8% gain). In real terms, earnings were -1.8%y/y, against a -1.6% forecast and 0.3% prior for Dec (also revised down). See the chart below, headline earnings is the white line, real earnings in the orange line
- In terms of cash earnings, bonus payments fell to -3.7% y/y, versus a 6.2% gain in Dec. This likely weighed on the headline result. Scheduled pay still rose 3.1%y/y, up from 2.6% in Dec, which was a strong result.
- Scheduled cash earnings, on a same sample basis was well below expectations, rising 2.0%y/y, versus 3.5% forecast and 5.3% from Dec. Again though shifts in one-off payments look to be a factor, with special payments falling 10.2%y/y from a 7.5% gain in Dec.
- Scheduled full time pay, on a full time basis, rose to 3.0%y/y, versus 2.9% forecast and 2.8% prior. This metric is still showing firm trends (the green line on the chart below).
- This should help offset some of the negative sentiment around the weaker headline/real earnings results.
Fig 1: Japan Labor Earnings - Headline Y/Y Momentum Slowed In Jan
Source: MNI - Market News/Bloomberg
