In local morning trading, NZGBs are 6-7bps richer. There is little in the way of local market data today, with morning moves driven by US tsys after US CPI was in line with expectations while retail sales data missed estimates, short end rate cut pricing now projects two 25bp rate cuts by year end (Sep & Dec).

  • US treasury futures finished trading on Wednesday near session's best, the 10Y contract was up (+0-20) at 109-23, while yields were 8-11bps lower. Tsys futures have erased all losses made post March CPI.
  • The NZGB curve is has flattened slightly this morning with the 2Y -5.8bps at 4.665%, 10Y is -6.2bps at 4.580%.
  • Swap rates are unchanged this morning
  • RBNZ dated OIS has firmed this morning as the markets prices 2-5bps more of cuts into year-end, with a cumulative 48bps of easing now.
  • Looking Ahead: Non Resident Bond Holdings Today and PPI Input/Output On Friday

BONDS: NZGBs Richer, Curve Flatter, OIS Pricing Almost Two Cuts Into Year-End

Last updated at:May-15 22:48By: Sam Hunter

In local morning trading, NZGBs are 6-7bps richer. There is little in the way of local market data today, with morning moves driven by US tsys after US CPI was in line with expectations while retail sales data missed estimates, short end rate cut pricing now projects two 25bp rate cuts by year end (Sep & Dec).

  • US treasury futures finished trading on Wednesday near session's best, the 10Y contract was up (+0-20) at 109-23, while yields were 8-11bps lower. Tsys futures have erased all losses made post March CPI.
  • The NZGB curve is has flattened slightly this morning with the 2Y -5.8bps at 4.665%, 10Y is -6.2bps at 4.580%.
  • Swap rates are unchanged this morning
  • RBNZ dated OIS has firmed this morning as the markets prices 2-5bps more of cuts into year-end, with a cumulative 48bps of easing now.
  • Looking Ahead: Non Resident Bond Holdings Today and PPI Input/Output On Friday

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